The Universal Music Group, the world's largest record label, has agreed to purchase the previously privately held Dreamworks Records for an undisclosed sum. The two companies had previously been partnered with Universal serving as distributor for Dreamworks.

Dreamworks was launched in 1995 as part of the multi-media conglomerate started by partners Steven Spielberg, David Geffen and Jeffrey Katzenberg. The label was guided by a team of veteran label execs including Mo Ostin and Lenny Waronker, who helped establish Warner Bros. as one of the most prestigious and productive record labels in the Seventies. Dreamworks Records was modeled in a similar fashion to the Warners of the Seventies, cultivating artists like Elliott Smith and Rufus Wainwright who might not have offered short-term profitability. Still, over the past eight years, Dreamworks did enjoy some breakthroughs with new artists like Papa Roach, Nelly Furtado, Alien Ant Farm, while also successfully selling veteran acts like the Isley Brothers.

"Building Dreamworks Records has been one of the great professional experiences of my career," Ostin said. "I'm proud of the phenomenal artists we've been associated with. Despite the challenges of the music business today, Universal is acquiring a wonderful asset and the sale will assure the strongest possible future for our artists."

Universal will fold Dreamworks into its Interscope/Geffen/A&M label, according to reports, under the leadership of Jimmy Iovine.

ANDREW DANSBY
(November 11, 2003)