Cases & Deals

Warner Music Group intervenes in Universal's acquisition of EMI's recording business and Sony's acquisition of EMI's publishing business

Client(s) Warner Music Group Corporation

Jones Day served as lead counsel to Warner Music Group as a third-party intervenor in Universal's acquisition of EMI's recording business for €1.4 billion, as well as in the acquisition of EMI's publishing business by a consortium involving the Sony Corporation for total consideration of €1.6 billion. Both transactions were approved, in respectively September 2012 and April 2012, subject to significant divestments. Warner Music Group opposed both transactions in a large number of jurisdictions including the EU, U.S., Brazil, Japan, and Australia.

This complex representation involved the coordination of a global opposition strategy to a high-profile transaction with significant competitive implications ("four-to-three" merger). The analysis required in-depth knowledge of the music industry, which has seen a dramatic evolution as a result of digitalization, leading to a completely novel eco-system. The transactions raised competition law issues that are closely tied to IP rights, which are particularly complex for recorded music and music publishing, given the large number of rights for the different types of usage and the differences due to a fragmented legal environment. Finally, the issues went beyond traditional economic interests protected by competition law, raising issues of cultural diversity, which could be impacted by the transaction. This cultural diversity factor may influence the way in which competition law principles are applied.