UMG's Divestitures to Cement EMI Deal?

LET THE DIVESTITURES BEGIN: UMG could be offering to sell off Virgin Records and EMI Classics as well as distribution rights to indie label Mute to achieve European Commission OK  for its acquisition of EMI, according to the N.Y. Times. UMG execs will meet with EC members in Brussels this week to discuss concessions. The EC's decision is slated for Sept., but could come earlier. UMG could sell the labels outright or divest its European rights, according to sources. "I'm extremely open-minded about working with the EC in the context of behavioral remedies as well as divestitures," UMG boss Lucian Grainge said. As I.B. Bad discusses here, having to sell off some of those assets at less-than-market value could negatively impact the deal’s financial benefits. According to calculations, a divestment of 10 -15% of EMI's catalogs could cost Universal as much as $400 million. (7/16p)