NEW YORK (Reuters) – 3,3 billion winner bid access Industries' to buy Warner Music Group Corp. adds another company of media of the empire of billionaire Len Blavatnik and paves the way for a possible bid for the rival EMI Group.
All-cash of the Blavatnik treat for values of Warner Music third company in the world to $8.25 a share more than the debt. Private investor THL partners, which has invested in 2004, if student double his money.
The acquisition adds to the list of Blavatnik of media companies such as the Russia Admedia and Top Up TV's United Kingdom the.
It also cemented a long relationship between the Russian-born billionaire and Warner Music Chief Executive Edgar Bronfman Jr. and his father. Blavatnik to buy House Bronfman Jr in 2007 for $ 50 million, 11 times what music chief had paid 12 years earlier.
Blavatnik is likely to prevent management from Warner Music and turn the team leading a run for EMI, home of the current acts as Lady Antebellum and Coldplay and marquee names that include the Beatles.
EMI is the property of Citigroup, who took control of the company after its former private equity owner that Terra Firma in breach of the loan.
If Blavatnik made a bid for EMI, he could be rewarded by a rapid return on his investment by combining the companies and save hundreds of millions of dollars in costs.
Blavatnik has agreed to pay a premium of 63 per cent share of Warner on January 20, when news broke that the Council of the music society had assigned advisors to explore strategic options - including a sale.
Warner Music, whose roster of artists include Bruno Mars, Green Day, Red Hot Chile Peppers and Led Zeppelin, will become a self-contained unit of access. He will sit alongside industrial property, including natural resources and chemicals, as well as the media and telecommunications.
Blavatnik beaten bids in the last round of Tom and Alec Gores Platinum Equity/The Gores Group and Sony Corp. in partnership with partners from Guggenheim and investor Ron Perelman. Other first and second round bidders included BMG Music Rights, a joint venture between Bertelsmann and KKR; and Yucaipa Co. investor Ron Burkle
Bloomberg noted Friday that the Gores are weighing a counteroffer to the submission of the Blavatnik $ 8.35 to $ 8.50 for Warner, citing a source. A spokesman for Gores refused to comment on.
EMPIRE EXTENDING
Blavatnik, 53, an American citizen since 1984. Living in London and New York, Blavatnik class no. 80 on the Forbes billionaires list exit in March, with net worth of $ 10 billion.
Blavatnik became a Director at Warner Music in 2004, when Bronfman led a takeover of Time Warner Inc. company investment capital. Although he resigned from the Board of Directors in 2008, he retained a 2 percent stake in Warner Music.
Other media the Blavatnik investments include broadcaster's Top Up TV, Scandinavian mobile data and voice and producer of the television series Russian provider ice.net required.
Known for its investments in natural resources and chemicals, it is also a Director of Rusal aluminum giant CPU.
TROUBLESHOOTING OF REDEMPTION
Bronfman and corporations of private capital Thomas H Lee partners and Bain Capital Partners together hold around 56% of the outstanding shares of the company and have concluded an agreement with right to vote with access to vote for the merger.
Thomas H Lee partners will return approximately twice 655 million dollars invested initially on the sale of Warner Music Group to access Industries, a source familiar with the investment, said Friday.
Based in Boston THL partners has been the largest investor of private capital in the redemption of 2.6 billion of Warner Music in 2004.
655 Million includes co-investors - sponsors invested alongside silver THL.
Investment has harvested THL and its co-investors 775 million in a series of dividends paid over the life of the investment, most of which were paid during the first year, the source said. THL and the set of the co-investors approximately 56 million shares at Warner is about $ 460 million to the offer price for Friday, $8.25.
Taking Warner Music from the application to be listed is seen as an opportunity for Warner Music executives to take a major gamble on the model of traditional business to the shrinking of the piracy of saletrailing and a digital uncertain of future focus.
Secure access deal financing of Credit Switzerland and UBS, which were also advisers on the transaction alongside & Debevoise Plimpton LLP. Warner Music was advised by Goldman Sachs, the AGA partners and Paul, Weiss, Rifkind, Wharton & Garrison LLP.
(Reported by Yinka Adegoke and Megan Davies.) Editing by Gerald e. McCormick, Gunna Dickson and Richard Chang)
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