- Summary: Vivendi outbid six competitors to buy Bertelsmann AG's BMG Music Publishing business for $2.1 billion, making it the world's biggest music publisher, pulling ahead of rivals EMI Group PLC and Warner Music Group (WMG). It also puts the conglomerate in a position to dictate terms when it comes to licensing music for TV shows, commercials and movies. Music publishers control the rights to melodies and lyrics, and earn steady, low-cost revenues by licensing them to record companies, film and TV producers, as well as ringtone and videogame makers. The deal is subject to U.S. and European Union regulatory review; music publishing is generally held to a less-stringent standard than recorded music, because it doesn't do business directly with consumers.
- Comment on related stocks/ETFs: In a recent earnings conference call, WMG executives discussed future acquisitions.
Excerpt from our One Page Annotated Wall Street Journal Summary (receive it by email every morning by signing up here):