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BMG Joins Forces With Global Investment Firm KKR For Music Acquisitions

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(CelebrityAccess) — Label services company BMG announced it has partnered with investment firm KKR to join the ongoing acquisition frenzy for recorded music, music publishing and other music rights.

Under the terms of the agreement, BMG and KKR will team up to make deals to acquire individual music catalog, leveraging BMG’s expertise with KKR’s financial resources, providing the partnership with the capability to invest in transactions of all sizes.

However, the new relationship does not involve any transfer or sale of equity in BMG or the formation of a joint venture between KKR and BMG, which is part of the international media, services and education company Bertelsmann.

KKR, formerly known as Kohlberg Kravis Roberts & Co. Manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, credit, and maintains strategic partnerships with hedge funds. As of December 2020, KKR reported $252 billion in assets under its management.

For the last decade, BMG has been at the forefront of music rights acquisitions, including music publishing deals such as Chrysalis, Crosstown, Cherry Lane, Bug and R2M, rand recorded music deals for the Sanctuary, Mute, Skint/Loaded and Strictly Rhythm catalogs; and the Infectious, Vagrant, S-Curve, Rise and BBR Music Group labels.

“BMG and KKR can jointly pursue opportunities for acquisitions of major catalogs of music rights from now on. Together with KKR, we are ideally positioned to make attractive offers to rights owners.” Rabe recalled the two companies’ successful collaboration in the past: “KKR was already the ideal partner and catalyst once before, following the reestablishment of our music subsidiary in 2008. We subsequently bought back all of the BMG shares held by KKR in 2013 and since then, BMG has developed into one of the most successful music companies of the streaming age, and one of Bertelsmann’s three global content businesses. Now we will ignite the next stage with KKR,” said Bertelsmann Chairman & CEO Thomas Rabe.

“Our early partnership with KKR helped us rapidly become the first new international music company of the streaming age winning the trust of artists and songwriters with great service and 21st century levels of fairness and transparency. This new relationship with KKR will offer artists and songwriters a well-funded, financially stable home for their music assets with the confidence that their songs and recordings will be managed both professionally and respectfully,” added BMG CEO Hartwig Masuch.

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