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Warner Music Group sold for $3.3 billion to Access Industries' Len Blavatnik

Green-day-span Access Industries, a holding company founded by oil baron Len Blavatnik, won the auction to buy Warner Music Group Corp. for $3.3 billion in cash, the companies announced Friday morning. 

Blavatnik edged out more than a dozen other suitors including Sony Music Group, supermarket magnate Ron Burkle, Platinum Equity, Live Nation Entertainment and investment firm Kohlberg Kravis & Roberts, whose unsolicited offer late last year kicked off the auction process. KKR's partner in the bidding was German music company Bertelsmann.

The deal calls for Warner to receive $8.25 per share, a 34% premium over the company's average stock price over the last six weeks, the company said. It's also 75% higher than Warner's closing price on Jan. 20, the day before the New York Times published news of the bidding. Warner's share closed at $7.90 on Thursday.

Blavatnik, whose all-cash bid was the highest, had other advantages, said a source familiar with the sale. The Russian-born industrialist, who had been a Warner board member between 2004 and 2008, was also knowledgable about the company's operations and finances.

More importantly, Blavatnik's offer had an edge over Sony and Bertelsmann in that it would not run into antitrust hurdles by combining with another music company in a market that is already concentrated in the hands of four companies -- Universal Music Group, Sony, EMI and Warner.

The sale comes at a challenging time for the record industry, whose revenue has been ravaged in the last decade by piracy and a profileration of legal but free alternatives, including online radio services such as Pandora and Slacker.

Another music company, London-based EMI, is expected to be put up for sale later this year, presenting Blavatnik with an opportunity to acquire the company and combine it with Warner to produce the world's largest music company.

-- Alex Pham

Photo: Green Day, on the Warner Music Label, performs in Irvine. Credit: Mariah Tauger / Los Angeles Times


Comments () | Archives (12)

Would this be the same Blavatnik that left the Royal Bank of Scotland holding the bag?

The British bank RBS has loaned a Russian Oligarch £2.5 billion loan, he defaulted, and the British taxpayer gets the bill. The past lending practices of RBS – of which the taxpayer now holds a majority share – have emerged as a particular concern.


More info, please.

Edgar Brontman sold the company, no?

And how much did Brontman buy it for a few years back?

"piracy and a profileration of legal but free alternatives"


The cut throat greed has caught up with the industry. The little pigs are scattering to whatever dark corners that they can find. What gets me is that the largest blame is the online piracy is sounding the death nell.

How about putting out some real talent. Perhaps people would buy more records.

Crooks, gangsters are who inhabits the industry...demise is well deserved.

Again the tired old excuse of illegal downloads being the sole cause of the poor performance of the record industry, and once again without any data whatsoever to back this thesis up. I've been involved in this fiasco for over 40 years and what I see is the cynical concentration on lipsynch acts that appeal only to musically undereducated very young people. After a few DECADES of this, there are no longer any A&R staff who can recognize genuine talent if it bites them in the genitals. True, the occasional Keith Urban, Kid Rock, or John Mayer slips through, but apparently only accidentally. Meanwhile the tiny indies, and even more tellingly the OLDIES reissue labels, are doing just fine. True, the old school execs were by and large criminals, but at least they had a genuine love for music. Now it's bankers running the show, the same folks who've manage to crash the ENTIRE WORLD 'S economic system. So no surprise that they've managed to screw up the record biz, but don't worry, they'll lose their entire investments sooner or later, and a new generation will rise to eventually foul it up in their turn. Ain't life wonderful!

Does this mean Youtube will stop deleting the audio over "WMG" issues?

Wow, must be nice to be able to set fire to $3B like that...

It's a backdoor breaking of anti-trust laws if Blavatnik now purchases London-based EMI.

Since 4 companies monopolize the music industry, we can see they've violated anti-trust laws already.

No wonder the musicians are being ripped off so heavily.

Warmongers like Warner Brothers are waging Armageddon on musicians and civilians at the same time, robbing us all, killing our songs while mocking us through entertainment that tells us that they are planning to kill us. Israeli David Geffen's label put out the song "Rearranged" told us 9/11 was coming.

@ rumblestrip - Kid Rock!?

Rumor has it that Len Blavatnik and his Access Industries will make a run at EMI

Yucaipa Company’s., Ronald Burkle’s investment company in Los Angeles, won’t submit a final offer when bids are due May 2 for Warner. Burkle’s business is all downhill hinging on Bukles reputation for building hundreds of defective new homes while on the Board of Directors of KB Home. Just Google a KB Home S-ucks. http://www.akbhomesucks.com Burkle is on a downward slump with no success in taking over Banes and Noble along with Stephen Bollenbach. Loss of Miramax movie division pictures takeover bid. Loss of takeover bid for Warner Music.

Total album sales have decreased by more than 50% from 1999 till today. 90% of the music being downloaded is unauthorized and illegal...

It's time we stopped talking ourselves into believing that this is because of a lack of talented artists. It's pretty obvious what happened.



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