Warner Music Group gets look-see from Russian-born oil baron Len Blavatnik
Warner Music Group, which recently hired Goldman Sachs to vet buyout bids from Kohlberg Kravis Roberts and others, has gotten the once-over from industrialist Len Blavatnik, according to people familiar with the companies.
If Blavatnik's name sounds vaguely familiar, it's because he cropped up last year as a bidder for MGM. The billionaire, however, withdrew his bid in May. He later hooked up with Harvey and Bob Weinstein in October, investing $25 million to $100 million in the brothers' movie outfit Weinstein Co. in exchange for the right to distribute the company's films in Britain and other foreign markets.
His interest in Warner Music Group, first reported by Reuters, isn't as strange as it may seem. Blavatnik already owns 2% of Warner's shares and sat on the board of the New York-based music publisher and record label from 2004 to 2008.
Blavatnik, who was born in Moscow but became a U.S. citizen in 1981, also has deep pockets, with a fortune estimated at $7.5 billion by Forbes magazine.
Still, Blavatnik will have to compete with KKR and others that have expressed an interest in buying part or all of Warner, the world's third-largest music company. Universal Music Group and Sony Music Entertainment have also sniffed around, sources said, but their bids may be handicapped by potential antitrust constraints since the two currently are the No. 1 and 2 record labels in Europe and the U.S., respectively.
Sony, however, has expressed interest in just the publishing portion of Warner, a business that has fewer antitrust restrictions.
To complicate matters, Warner itself is reportedly interested in acquiring parts of EMI Group, which was seized earlier this month by its banker, Citigroup.
The first round of bids for Warner Music have not been formally submitted to the company's board of directors, a person close to the matter said.
-- Alex Pham