The Sony Corporation of America's $2.2 billion acquisition of EMI Music Publishing was approved by the European Union today with few concessions, despite protests from Warner Music Group and independent label groups such as Impala, Billboard reports. The deal now awaits approval by the United States Federal Trade Comission.
The EU has stated, though, that its decision is conditional upon Sony/ATV divesting worldwide publishing rights to four catalogs (Virgin Music Publishing U.K., Virgin Europe, Virgin U.S., and Famous Music U.K.) and the musical works of 12 authors (including Ozzy Osbourne, Robbie Williams, Ben Harper and Lenny Kravitz). Their reasoning is that without such divestment, the merger would have allowed Sony/ATV to dominate the marketplace, as they would own full or partial publishing rights to over half the chart hits in the U.K. and Ireland, which would affect the ability to license such songs in the U.K. and across Europe.
The commission concluded that with this divestment, "the transaction would not significantly impede effective competition in the EEA [European Economic Area] or any any substantial part of it."
Last month, Sony offered to sell off $20 million in publishing assets, which undoubtedly helped spur the approval process. In a statement, Sony/ATV Music Publishing chairman and CEO Martin Bandier – who spent 17 years helping to build EMI Publishing – said the approval was "not only an important milestone on the path to final approval, but a very special day for me personally." Because Sony and EMI have different ownership structures, Sony/ATV will act as an administrator for EMI's publishing assets, allowing EMI to be maintained as a separate company if the acquisition is fully approved.
Sony announced they planned to purchase EMI Music Publishing last November, around the same time Universal Music Group purchased EMI's recorded music division for $1.9 million. The latter deal, as Billboard also points out, has entered the second phase of approval in Europe, with a decision expected in August at the earliest.