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AS VIVENDI PREPS FOR UMG SALE, LIBERTY’S ALL EARS

Vivendi has selected 15 banks to consider in its search for a bank to help it sell as much as half of Sir Lucian Grainge’s red-hot UMG. The company made the announcement on 11/15 after noting Q3 results, where the music company reported a 13.5% increase in revenue over 2017.

Vivendi will hold working sessions with the banks before the end of fall to determine their qualifications and discuss the potential terms of engagement and fees. Vivendi intends to retain five to seven banks that will be charged with finding the best partners for UMG.

The parent company will wait for UMG’s 2018 financial results, which will be published on 2/14, before starting discussions with potential partners.

A day before the Vivendi reveal, John Malone’s acquisitive Liberty Media offered one of its own.  During the company’s Investor Meeting, MBW reported, CEO Greg Maffei—who doubles as Chairman of SiriusXM—was asked whether Liberty might be interested in acquiring a piece of UMG.

“Start with the premise that if there’s anything that comes up in music, we likely look [at it],” Maffei responded. “We’re as big a force, we have as much cash flow, as anybody in the music business. We will look at everything. Will we look at UMG if presented [with the opportunity]? Absolutely.”

Maffei’s confirmation of interest in Universal comes amid speculation about Liberty increasing its stake in Live Nation.

Returning to business as usual, UMG revenues hit $1.69 billion in Q3, up 13.5% at constant currency. For the first nine months of 2018, UMG’s revenues are up 9.1% at constant currency.

Recorded-music revenues grew by 10.2%, as growth in subscription and streaming revenues more than offset the continued decline in both download (-24.6%) and physical (-16.3%) sales.

Universal topped $2b in revenue from streaming and subscriptions in the first nine months of the year; that segment represents 56% of all revenue. At just under $2.1b, streaming is up 35.8% over 2017.

Music-publishing revenues grew by 10.6% at constant currency. UMG noted that its songs occupied the #1 spot on the Spotify Global Chart for 37 out of the first 39 weeks of 2018.

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