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Madonna apparently liked the sound of Live Nation’s latest offer—for $120 million in cash and stock spread over 10 years—enough to give her assent through attorney Allen Grubman.
MADONNA ABOUT TO JUMP ON SWEET "360" DEAL
Live Nation Makes an Offer She Can’t Refuse
It was “sources” who first told us about Live Nation’s efforts to lure Madonna away from Warner Bros. Records back in July, and yesterday, “sources” were busy whispering the details of what they’re saying is a nearly completed deal. Logically, they started with The Wall Street Journal’s Ethan Smith, and his story has been parroted in myriad news reports.  

Madonna apparently liked the sound of Live Nation’s latest offer—for $120 million in cash and stock spread over 10 years—enough to give her assent through attorney Allen Grubman, and the two parties are now dotting the I’s and crossing the T’s.

The package includes a general advance of $17.5 million and advance payments for three albums of $50 million to $60 million, Smith further revealed. Like other new-look artist contracts, the deal involves the splitting of revenue from concerts, merchandise and brand licensing as well as record sales. By bringing virtually all of Madonna's ventures under one roof, Michael Rapino’s company hopes it can make money by cross-promoting all of the above.

More details from Smith: Live Nation also is expected to pay $50 million in cash and stock for the right to promote Madonna’s concert tours. If and when she does tour, though, the promoter will only get 10% of the gross, with 90% going to the artist; that is the standard split for music superstars in the concert industry these days. Income from licensing ventures such as the use of Madonna's name on fragrances or other products would be divided evenly with Live Nation.

The reporter also noted that Warner Music Group had partnered with Ticketmaster parent IAC/InterActiveCorp, owned by Barry Diller, in an effort to re-up the Rock and Roll Hall of Fame 2007 nominee. If you’ve been following our own I.B. Bad, you already know that, of course. Apparently, the tandem concluded that LN’s latest offer had hit the stupid-money level and chose not to counter it.  

At current CD prices, Live Nation would have to sell about 15 million copies of each of the three albums to make back its investment on that piece of the deal alone. Additionally, the masters will revert to the artist at some undetermined point.

WMG, which will retain the rights to Madonna's catalog, will get one more last studio album under the terms of her expiring deal; that album is expected to be released next year.

It’s generally assumed that LN will enter into a licensing arrangement with a major to release, distribute and market the three albums, since the promoter lacks the infrastructure to handle those tasks.

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