With its acquisition of BMG Music Publishing, Vivendi Universal Music is no longer the world's largest seller of recorded music, it is now also the largest music publisher in the world. They bought BMG Music Publishing for $2.1 billion. As part of the deal, Bertelsmann, parent of BMG, said it would settle litigation with Vivendi for $60 million for its connection in financing Napster.
Although there were six other bidders, once they were made aware that BMG was up for sale, Vivendi was considered the favorite for landing the company.
As Reuters reported, one of the draws to music publishing companies is "...because they are partly shielded by many of the piracy issues that have rattled the music industry. In addition to generating revenue when CDs or downloads are sold, music publishers make money by licensing songs to be performed live and for use in films and television shows."
While the boards of both companies have approved the deal, it will probably be looked at closely for antitrust violations. Consolidation in the industry has been resisted in the past.
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