Wall Street was jumping on another rumor today—this time, that WMG is being more aggressively shopped. Haven't we heard this one before? Of course we have, though the latest—courtesy of the New York Post—suggests that Bronfman and company are jockeying to sell their label before Citigroup can sell theirs. So this is how it ends?
We've heard a lot of mismatched rumors on this, though the Post is now pointing to the presence of 20 different potential WMG buyers, many of whom are also eyeing EMI. With that in mind, the Warner team is apparently pushing for first-round bids by the end of next week.
Currently, the mix of potential suitors includes Zomba founder Clive Calder, Russian billionaire Leonard Blavatnik, UMG, Sony Music, private equity firms KKR, Apollo and Providence Equity; and publishing group Imagem. But, why would anyone be interested in Warner, especially with sales cascading downward? Isn't that sort of like buying a house in Vegas? After all, WMG just posted its 8th-straight quarterly loss, and publishing is also on the down-and-down.
Well, the reasons for the interest, according to our sources, are quite varied. On the pure 'dumb money' side, there lies the possibility of a vanity acquisition, perhaps by a bored billionaire. On the private equity side, Guy Hands has certainly curbed the enthusiasm, though one source noted that both WMG and Citigroup are highly-motivated sellers—meaning, the rules of fire-selling may apply.
Others may have smart combinations in mind, and far more value lies on the publishing side. That includes the possible breakup of various publishing units, and even the rollup of EMI Music Publishing and Warner/Chappell. “They're buying this [publishing] stuff pretty cheap, and if you fire everyone there are certainly efficiencies," one major publishing executive bluntly shared.
Stay tuned.
We've heard a lot of mismatched rumors on this, though the Post is now pointing to the presence of 20 different potential WMG buyers, many of whom are also eyeing EMI. With that in mind, the Warner team is apparently pushing for first-round bids by the end of next week.
Currently, the mix of potential suitors includes Zomba founder Clive Calder, Russian billionaire Leonard Blavatnik, UMG, Sony Music, private equity firms KKR, Apollo and Providence Equity; and publishing group Imagem. But, why would anyone be interested in Warner, especially with sales cascading downward? Isn't that sort of like buying a house in Vegas? After all, WMG just posted its 8th-straight quarterly loss, and publishing is also on the down-and-down.
Well, the reasons for the interest, according to our sources, are quite varied. On the pure 'dumb money' side, there lies the possibility of a vanity acquisition, perhaps by a bored billionaire. On the private equity side, Guy Hands has certainly curbed the enthusiasm, though one source noted that both WMG and Citigroup are highly-motivated sellers—meaning, the rules of fire-selling may apply.
Others may have smart combinations in mind, and far more value lies on the publishing side. That includes the possible breakup of various publishing units, and even the rollup of EMI Music Publishing and Warner/Chappell. “They're buying this [publishing] stuff pretty cheap, and if you fire everyone there are certainly efficiencies," one major publishing executive bluntly shared.
Stay tuned.
