(CelebrityAccess) — Sony Music Entertainment announced it has reached a deal with Kobalt Music Group to acquire Kobalt’s recorded-music business, including Kobalt’s Neighbouring Rights division, and its independent label services operation AWAL.
Under the terms of the agreement, AWAL and Kobalt’s Neighbouring Rights will become a new division for Sony, offering ‘independent’ artist and label services and will enhance Sony’s indie music distribution operation The Orchard.
Following the closing of the deal, which is subject to regulatory approval, Lonny Olinick will remain CEO at AWAL.
The closing cost of Sony Music’s agreement with Kobalt was $430 million, according to regulatory filings.
Kobalt’s Neighbouring Rights division, led by CEO, Ann Tausis, is the prominent administrator of neighboring sound recording rights with its direct relationships with global collection societies. The Neighbouring Rights business has grown to represent more than 2,000 performers. With this agreement, SME artists and The Orchard distributed labels will be able to partner with Neighbouring Rights with access to its infrastructure and collection network.
“Our investment in AWAL’s continued growth gives us another level of service to offer the independent music community. With their flexible solutions to building artist careers, together we will offer creators more exciting choices to connect with their audience worldwide,” said Sony Music Chairman Rob Stringer.
“The AWAL team has futuristically enabled artists to deliver their creative vision since its inception. Now, as part of the global Sony ecosystem, we can dramatically expand on this vision for them. We are also excited to build on our innovative neighboring rights as well as DIY platforms with extended support from The Orchard,” added Lonny Olinick, CEO of AWAL.