Sony to buy Bertelsmann out of Sony BMG for $1.2bn

by Darren Davidson, Brand Republic 05-Aug-08, 15:30

LONDON - Bertelsmann AG is selling its 50% stake in Sony BMG to Sony Corporation in a deal worth $1.2bn (£614m), giving the Japanese company full ownership of the joint venture which represents artists including Alicia Keys and Leona Lewis.

The new company will be called Sony Music Entertainment Inc and become a wholly owned subsidiary of Sony Corp of America. The joint venture was created in August 2004.

Hartmut Ostrowski, the Bertelsmann chief executive, said the decision was consistent with the German company's new growth strategy.

He said: "Sony has been an excellent partner, and they are the right company to take this business to the next step and ensure that it realizes its full value and potential."

Once the deal, which is set to face regulatory scrutiny, is complete, Sony Music Entertainment will be comprised of several music labels, including Arista Records, Columbia Records, Epic Records, J Records, Jive Records, RCA Records and Zomba.

Its artists will include among others Celine Dion, Bruce Springsteen, Justin Timberlake and Usher.