Sony to buy out EMI Music Publishing in a $2.3Bn deal to become world's largest music publisher

Japanese entertainment giant Sony is buying music publishing major EMI Music Publishing, to get access to a catalog more than two million songs from artists like Beyonce, Queen, Kanye West and Pharrell Williams among others.

As per the deal, Sony is buying 60% stake from a consortium led by Mubadala Investment company for $1.9 billion. It is also paying an additional $400 million to existing shareholders bringing the total deal price to $2.3 billion, according to a CNBC report.

Sony already owns around 39.8% in EMI and if the deal goes through, it will indirectly own around 90% stake in EMI Music Publishing, which would become a consolidated subsidiary of Sony.

Sony said the deal values EMI Music Publishing at $4.75 billion, adding that "the closing of the transaction is subject to certain closing conditions, including regulatory approvals".

EMI is the second-largest music publishing company by revenue and either owns or has rights to around 2.1 million songs, including classics by the likes of Queen, Sam Smith, and Pharrell Williams.

It commands 15% of the music publishing industry which with the current Sony ATV business would make the Japanese entertainment and electronics giant the industry leader with market share of 26%. Current songwriters under EMI Publishing's banner include Kanye West, Alicia Keys, Drake, Pink, Fetty Wap, and Hozier.

As for Sony, it already owns 2.3 million copyrights including the Beatles catalogue, apart from being a major player in IT, communications, film and gaming.

The transaction is Sony's first major deal under new CEO Kenichiro Yoshida, who noted the music business has enjoyed a "resurgence" in recent years due to streaming services such as Spotify and Apple Music.

With this purchase, Sony "is becoming one of the biggest music publishing companies, both in name and reality", Yoshida told reporters.

"We are thrilled to bring EMI Music Publishing into the Sony family and maintain our number one position in the music publishing industry," Yoshida said in an earlier statement.

"I believe this acquisition will be a particularly significant milestone for our long-term growth," added Yoshira, who took the helm last month.

Yoshida also unveiled Sony's latest strategic plan, which aims to bolster its content business - pursuing the direction his predecessor Kazuo Hirai had taken to revitalise one of Japan's best-known firms.

"We are a technology firm, but the technology means not only electronics but also entertainment and content-creation" in today's world, Yoshida said.

Sony will continue to build up its content services, as indicated by the EMI Publishing deal - and also invest heavily in cutting-edge technologies including image sensors, he said.

"In the music business, copyrights are crucial. So the deal is meaningful and its price appears practical and reasonable," Hideki Yasuda, an analyst at Ace Research Institute in Tokyo told AFP, adding that success would depend on the quality of the content Sony creates in the future.

The electronics and entertainment behemoth last month reported record annual profits of $4.5 billion, a roaring recovery supported by better sales across the board and helped by box office blockbusters like its Jumanji reboot.

Those figures were seen as a fitting send-off for Hirai, who recently stepped down as the firm's chief executive after spending the past six years pulling the firm out of deep financial trouble. Hirai led an aggressive restructuring drive at Sony, cutting thousands of jobs while selling business units and assets.