Bertelsmann Wants $1.5 Billion For Sony BMG Stake, Talks 'Advanced': Report
This story was written by Robert Andrews.
Finally, some meat on the bone of the "Bertelsmann wants to quit music" story. An unnamed source tells FT Deutschland the German media group wants to sell its 50 percent stake in Sony (NYSE: SNE) BMG to its JV partner for $1.5 billion within four to six weeks. It may only get $1.2 or $1.3 billion, the source said. Yesterday, Frankfurter Allgemeine Zeitung had another bite at a rumour that has bobbled about all year, but added little. But FTD says talks are "well advanced".
Bertelsmann's BMG revenue from SonyBMG fell 27 percent to 1.5 billion in 2007, partly from the sale of the company's publishing unit. But the core was weak, too - a 40 percent hike in digital music sales couldn't offset a 17 percent decline in physical sales. Losses slimmed dramatically in Q1 08 after Bertelsmann settled all its litigation payouts to rival labels annoyed by its earlier stake in Napster (NSDQ: NAPS). The Sony BMG merger was ratified for a second time in September, after Europe's 2004 approval was annulled.
By Robert Andrews