Sony and Jackson Estate reach agreement for Sony to acquire remaining half of Sony/ATV Music Publish

Bubs

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1. What makes you think that I read the Forbes article? I did not. I heard the news about the debt from other sources.

2. If that's true how come they couldn't pay that off since 2012 when they earned more than 100 m+ in every years since 2012, 160m in 2013 alone?
The revenue from the catalog was about 300 m / year. No way the Estate's profit was only 17m from that.
(we'll see how much the catalog brought it in 2017 the first year and the Estate's total earnings won't include anything related to Sony/ATV)
So now they say that the debt was still 250 m right before this deal when it was an estimated 280m in 2012! So what did they do in 2013 2014 2015?
Pay off 30 million while they earned about 400 million? They earned 9-figures for 9 years and they still need to sell the catalog to pay off 250 million?

You are funny:)
If you read TMZ or DailyFail, it is your own fault that you are not up to date whats going on as they are tabloids, not source of actual information.

Happy readings, that'll keep you occupied for hours if not days
http://www.dailymichael.com/the-estate

Don't forget that the estate was and still is 50-50 partner with Cirque, it also means they had to pay half of creation of the two shows.
 

christy

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It has not been a gravy train in the past few years. Yes, the Estate got about $17 million a year on paper, but it was all paid back because of the debts. So it wasn't what put food on PPB's table.

If the Estate had bought Sony's share that would have meant they should have got themselves in yet another big debt instead of paying their debts back (I have doubts the Probate Judge had even allowed that) and those debts would burden the catalogue for many years or even decades to come until it would start to produce actual profit for the heirs. Meanwhile the Estate would have put all or most of their financial resources into this one basket which is always much more risky than making diverse investments. Also, I think the costs of the management of the catalogue would be higher for the Estate than for Sony, because Sony already has a strong infrastructure to market those rights. The Estate does not have that infrastructure and to create at least some of them to work effecively would create additional costs. So it would rather cost them a lot of money before it would start producing profit in many, many years to come. And who knows where the music industry will be by then?

The alternative was this that we see here: get rid of all debts, get money and diversify your investments.
Diversify is the operative word here,and be debt-FREE especially in turbulent times. I wasn't looking at the estate to buy over Sony's share.
Michael already lost it few days before foreclosure when he signed the deal in 2006. What's done is done. Sony could have exercised their right 10 years ago, but didn't. Only till now. I'd only wished Michael had other options for a bail out 10 years ago. Now with the cash payout now they get to have, eliminate all of their debts & choose their investment strategies shrewdly and yes, DIVERSIFY.

 
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redfrog

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Bubs;4141257 said:
You are funny:)
If you read TMZ or DailyFail, it is your own fault that you are not up to date whats going on as they are tabloids, not source of actual information.

And just exactly what makes you think that I read TMZ or DailyFail?
Quite silly to assume that TMZ of all things would even report anything about Mj's debt unless it's a way to trash him.
And it's not that Forbes or any media for that matter is automatically the gospel when it comes to MJ.
But if you think it is what about this?

Today, the Sony/ATV catalog itself is worth somewhere in the neighborhood of $2 billion, thanks to its ownership of copyrights by The Beatles, Bob Dylan, Taylor Swift, Lady Gaga and others. The interest rate on Jackson’s loan connected to the catalog has been sliced from 5.8% to 2.9% since his death. At that low rate, paying back the loan quickly, in full, may not even be financially expedient—the company’s funds could be better utilized by buying up new, money-generating copyrights.

That said, given Jackson’s postmortem earnings prowess, the estate could probably pay off that loan fairly soon if necessary. The singer’s Immortal World Tour, a joint venture with Cirque Du Soleil, has grossed $160 million this year, making Michael Jackson the top-grossing live act in North America three years after his death. Other deals–including one with Pepsi, Jackson’s first endorsement pact in two decades–should continue to add to the estate’s coffers.

http://www.forbes.com/sites/zackomal.../#a9c0a3e3a08d


Bubs;4141257 said:
Don't forget that the estate was and still is 50-50 partner with Cirque, it also means they had to pay half of creation of the two shows.

Still doesn't explain why right before this deal was made they still had 250m debt. Essentially unchanged since 2012
 
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jaydom7

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I'm pretty sure Branca didn't try to find other investors either :smilerolleyes: He's a liar... May God strike him for being a liar and a fraud.. I don't trust him one bit.
 

redfrog

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jaydom7;4141264 said:
I'm pretty sure Branca didn't try to find other investors either :smilerolleyes: He's a liar... May God strike him for being a liar and a fraud.. I don't trust him one bit.

Of course he didn't. Sony pays him.
And the debt is no excuse for the sale.

Today, the Sony/ATV catalog itself is worth somewhere in the neighborhood of $2 billion, thanks to its ownership of copyrights by The Beatles, Bob Dylan, Taylor Swift, Lady Gaga and others. The interest rate on Jackson’s loan connected to the catalog has been sliced from 5.8% to 2.9% since his death. At that low rate, paying back the loan quickly, in full, may not even be financially expedient—the company’s funds could be better utilized by buying up new, money-generating copyrights.

That said, given Jackson’s postmortem earnings prowess, the estate could probably pay off that loan fairly soon if necessary. The singer’s Immortal World Tour, a joint venture with Cirque Du Soleil, has grossed $160 million this year, making Michael Jackson the top-grossing live act in North America three years after his death. Other deals–including one with Pepsi, Jackson’s first endorsement pact in two decades–should continue to add to the estate’s coffers.

http://www.forbes.com/sites/zackoma...bts-to-be-paid-off-by-years-end/#a9c0a3e3a08d

christy;4141258 said:
Diversify is the operative word here,and be debt-FREE especially in turbulent times. I wasn't looking at the estate to buy over Sony's share.
Michael already lost it few days before foreclosure when he signed the deal in 2006. What's done is done. Sony could have exercised their right 10 years ago, but didn't. Only till now. I'd only wished Michael had other options for a bail out 10 years ago. Now with the cash payout now they get to have, eliminate all of their debts & choose their investment strategies shrewdly and yes, DIVERSIFY.



No need to diversify when you have such a profitable asset like that catalog. It's not true that because of streaming publishing
is less lucrative. Quite to the contrary!

3) the Michael Jackson estate did a great bit of business…

When announcing the sale of the Sony/ATV stake, John Branca and John McClain, Co-Executors of the Jackson Estate, made sure to note how smart a deal this was for all concerned.

In a joint statement, they said: “[Michael’s] ATV catalogue, purchased in 1985 for a net acquisition cost of $41.5 million, was the cornerstone of the joint venture and, as evidenced by the value of this transaction, is considered one of the smartest investments in music history.”

Simple maths shows they have a very solid point.

Buy for $41.5m. Sell for $750m.

That’s an 18-times return on investment.

Shamone.
SPOTIFY4) … But not as great as Sony

So why did Sony pay such a seemingly inflated figure for the ATV catalogue?

Because it’s considerably grown in value since 1985 – that much is obvious.

But what’s also missed out in Branca and McClain’s statement is the fact that the value of this catalogue is still growing – and fast – thanks to the changing shape of the music market… particularly streaming.

Just look at the annual revenues of Sony’s music publishing business over the past three years alone.

SonyMusicrev.jpg

And MJ didn't lose it in 2006. If Sony had believed
they could get that catalog just by triggering the clause you can be sure they would have done just that! They knew MJ would fight
to buy their share and he would find investors who are interested.
They also knew that Branca won't fight. He is their guy after all.
 
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Gold Pants Girl

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It's so obnoxious seeing people say such ridiculous things, that are mostly completely untrue, it's like some people can't even comprehend simple facts or even articles that break this deal down, but I think it's mostly people just are looking for any excuse to hate on Branca (I guess McClain doesn't exist?) and Sony, doesn't matter if it's true or not, they obviously don't care about facts.

This deal is excellent business wise, it's the emotional and sentimental attachment that make it hard, fans need to accept the reality of these kinds of situations, it would be bad business and a dis-service to the estate to make big decisions based on emotions.


as for Katherine, I'm not surprised, even when MJ was alive, she would run to him to buy her things when she would find out he got some money (i.e. the luxury motor home) I stopped giving her the benefit of the doubt years ago.
 
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Ankita

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The Beatles will own it after 2026, that is..all songs written by them before 1978.. too long a wait though.
 

144000

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Exactly. You people have to nerve to just assume someone didn't read the thread. Stick to assuming these people killed MJ for the sale guys.

If I understand you correctly, let me ask. That video that I quoted/posted, with Michael speaking against Sony, and the signs he held up about Sony, which were not favorable toward Sony..and..statement he made where he stated that they want his catalogue and they are going to 'kill me' for it. Is that an assumption? Is that hate? Or was that founded fear from the one person who saw it all? Is it an 'assumption' to believe whatever Michael said? This isn't the first, and probably won't be the last time a potential victim or victim points out his/her perpetrators, before the crime happens. Is that really an assumption? If a woman knows a man is stalking her, and then she is raped...if a man knows that certain people are after members of his family, then they are killed, if a child knows another older stronger child has been bullying him/her, and then, later, that potential child victim is beat up, are we to always assume that these victims are paranoid? The victim usually has a good idea, who is perpetrating against them. Naturally, people outside the world of that victim, can't possibly feel or experience what that victim is going through, because of all of our tendency to see only things in our own world, and not someone else's..and our natural propensity to not be sensitive to someone else's trials.
 
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Ankita

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redfrog;4141271 said:
Of course he didn't. Sony pays him. And the debt is no excuse for the sale. No need to diversify when you have such a profitable asset like that catalog. It's not true that because of streaming publishing is less lucrative. Quite to the contrary! And MJ didn't lose it in 2006. If Sony had believed they could get that catalog just by triggering the clause you can be sure they would have done just that! They knew MJ would fight to buy their share and he would find investors who are interested. They also knew that Branca won't fight. He is their guy after all.
I am just so, so heartbroken.. way beyond words :-( and I second 'every bit' you say redfrog! Have been a warrior in his Army of Love for 23 years, and I, like other long time fans know that Michael held on to it till the end! He DID NOT want to sell it! This, from May 10, 2001, "I want to clarify a silly rumour – The Beatles catalogue is not for sale, has not been for sale and will never be for sale." -Michael Jackson :-( :-(
 

HIStory

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If I understand you correctly, let me ask. That video that I quoted/posted, with Michael speaking against Sony, and the signs he held up about Sony, which were not favorable toward Sony..and..statement he made where he stated that they want his catalogue and they are going to 'kill me' for it. Is that an assumption? Is that hate? Or was that founded fear from the one person who saw it all? Is it an 'assumption' to believe whatever Michael said?

That MJ said it is not an assumption. He did.

That Sony indeed killed him for his catalogue IS an assumption however. There is nothing that links Sony to MJ's death.
 

Billie Jean 78

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Michael, thinking of John Branca: "And you, Brutus?"

At the first one, probably yes.
Nr 2 most likely, however they got taught well by their father to be cautious on who to trust.
Nr 3 NO because Mrs Jackson isn't a money grubbing vulture, it's already bad enough that she has to deal with the loss of another child. (She lost Marlon's twin Brandon when he was only a baby)

Really? You really think she isn't? And she wouldn't be to feed her lazy grown up cubs??
 

144000

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That MJ said it is not an assumption. He did.

That Sony indeed killed him for his catalogue IS an assumption however. There is nothing that links Sony to MJ's death.
It wouldn't be the first time a crime is well covered up, a fallguy is created, or blame is mistransfered. Or the first time media wrote something that was not true. But one thing is well documented...there were/are
a lot of people who loved/love referring to MJ as 'paranoid'. A lot of people make the mistake of telling people to do what the teller would not do, but the safest thing to do is believe the victim.
 

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Gold Pants Girl;4141273 said:
This deal is excellent business wise,

So you think these guys don't know what they're talking about?

But what’s also missed out in Branca and McClain’s statement is the fact that the value of this catalogue is still growing – and fast – thanks to the changing shape of the music market… particularly streaming.

If publishing can keep up this rate of growth, Sony/ATV’s annual revenues will hit 96bn Yen in two years’ time – which currently equates to $880m US dollars.


http://www.musicbusinessworldwide.com/sonys-buyout-of-sonyatv-5-things-you-need-to-know/

If Sony didn't know that music publishing is actually a growing sector they wouldn't have paid 750 m for the catalog.


From the Estate's statement:

In the intervening months, we explored several options that would have positioned the Estate as the buyer, rather than Sony, and we had substantial interest from potential partners to work with us in doing so. Ultimately, however, Sony’s offer was in the best interest of Michael’s children and we made the difficult decision to accept that offer.

No explanation why this was in the best interest of MJ's kids at all. Who were approached, who were interested,
how much they would have been willing to invest, how much the Estate should have invested. They don't say.
We just have to believe that they didn't find enough and we just have to believe that.
While Branca is working for Sony and Sony making it clear for years that they wanted that catalog. Mkay.

There are several reasons that led to our decision. We will use a portion of the proceeds to repay the loan balance on monies borrowed by Michael and secured by his interest in Sony/ATV

Bullshit. With that low interest rate, publishing bringing in more money every year and MJ earning 100m+ every year the debt
could have been paid off without this sale.

Furthermore, the transaction allows the Estate to diversify assets which, to date, have been highly concentrated in music intellectual property.

And was highly profitable and will be even more in the future except only for Sony. They are talking like they
can sure find other investments which will make as much or more money. Your investments being are all over the place in and of itself
does not guarantee good returns.

That was our goal as well when we started on this path last year, but ultimately, Sony’s offer made more sense for the reasons outlined above.

I will believe those reasons when they disclose exactly what they tried to do to buy Sony's share.
 
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HIStory

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It wouldn't be the first time a crime is well covered up, a fallguy is created, or blame is mistransfered. Or the first time media wrote something that was not true. But one thing is well documented...there were/are
a lot of people who loved referring to MJ as 'paranoid'.

You are free to believe in something that has not even a iota of evidence, but that does not make it a fact. It makes it an assumption. And that was the point.
 

Justthefacts

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I'm pretty sure Branca didn't try to find other investors either :smilerolleyes: He's a liar... May God strike him for being a liar and a fraud.. I don't
trust him one bit.


The last time I checked God did not need your help in condemning people. And I am more then certain John Branca couldn't care less what you think of him
 

HIStory

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So you think these guys don't know what they're talking about?



If Sony didn't know that the publishing is actually a growing sector they wouldn't have paid 750 m for the catalog.

Where does this idea come from that if buy-sale deal is good for the buyer it is necessarily bad for the seller? Usually both paries hope for the best possible outcome for them, both hope they made the right decision. And often both make a good decision considering the position they are in. The positions and situation of the Estate and Sony are very different in this.
 

144000

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You are free to believe in something that has not even a iota of evidence, but that does not make it a fact. It makes it an assumption. And that was the point.
You either consider Michael to be a liar or telling the truth. Whether that is assumption or not, is up for debate.
 

144000

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You are committing a fallacy here. I will leave it up to you to realize what.
I'd rather you just tell me, since you think I'm into assuming. There is no proof that certain people aren't reading the thread. There's just blatant disagreement with responses, that's all. There's a lot of things people are claiming without proof. It's much more obvious about reading the thread, than it is about believing a victim's claim.
 

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ChrisC;4141219 said:
So Sony, in activating the clause, had to be prepared to lose the whole thing? Is that what you're saying? So party A makes a bid, and then party B can buy the whole thing? That doesn't make a great deal of sense. Ie. say the Estate activated the clause first, Sony would counter and purchase the Estate's half? Surely the agreement worked both ways afterall?

Yes Sony had to be prepared to lose the whole thing. Yes the agreement probably worked both ways as well.
Read the details here : https://en.wikipedia.org/wiki/Shotgun_clause and I'll copy some sections below

The shotgun clause allows a shareholder to offer a specific price per share for the other shareholder(s)’ shares; the other shareholder(s) must then either accept the offer or buy the offering shareholder’s shares at that price per share.

Shotgun clauses protect the interests of both or all parties regardless of their stake in the company. If one party decides to trigger the clause, it is in their best interest to make a well considered, fair offer - for if they make a low offer, their partner(s) may raise the resources to turn the offer against them, a counter offer they would be bound to accept.

Shotgun clauses tend to favour those people with cash readily available. Once a shotgun clause has been triggered, shareholders can often face difficulties obtaining traditional financing in order to buy the other shareholders’ shares, due largely to the very short timeline of the transaction.


As you can see from the above, Sony also had the risk of Estate buying their shares when they activated the clause. But also as you can see from the above, they probably believed Estate doesn't have the money and couldn't raise the money. It would give Sony the advantage.



redfrog;4141254 said:
2. If that's true how come they couldn't pay that off since 2012 when they earned more than 100 m+ in every years since 2012, 160m in 2013 alone?

gross revenues versus net income. You take gross revenues, deduct all your expenses, debt payments etc, then you pay taxes and then you end with net income.

The revenue from the catalog was about 300 m / year. No way the Estate's profit was only 17m from that.

According to leaked Sony emails in 2014 revenue of Sony/Atv was $565 Million. That's gross revenue number. After all the expenses and payments to artists Operating income was $89 Million. You need to pay taxes from that. distribution to owners was $42.7 Million. That makes $21.3 Million for Sony and Estate individually. Accounting document showed a $16.5 Million debt payment. Latest statement mentioned a $17 Million distribution. So in short it looks like they were guaranteed $21 Million and after other expenses, fees etc they end up with $17 Million.

Again there is a huge difference between gross revenues and net income. Don't mix two up.
 
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HIStory

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ivy;4141302 said:
As you can see from the above, Sony also had the risk of Estate buying their shares when they activated the clause. But also as you can see from the above, they probably believed Estate doesn't have the money and couldn't raise the money. It would give Sony the advantage.

And in the leaked e-mails we have seen that Sony actually DID contemplate selling their share of the catalog and they complained about the "complex ownership and governance of the business". So maybe they thought either option is better than the 50/50 situation.

ETA

From 2014

Sony Corp. was considering the sale of its music-publishing business, including a partnership with Michael Jackson’s estate that owns the Beatles catalog, as recently as last month, e-mails released by hackers show.


The “top secret” plan was being handled in the U.S. by Sony Entertainment Chief Executive Officer Michael Lynton, Sony Corp. of America President Nicole Seligman and their U.S. Chief Financial Officer Steve Kober, according to a Nov. 21 e-mail from Kober. The company had concluded the business had few growth prospects.


Top management at Tokyo-based Sony was concerned about the complex ownership and governance of the business, whose owners also include billionaire David Geffen and Abu Dhabi investors. Details of the sale plan, including possible terms or suitors, couldn’t be determined. The documents were released as part of the cyber-attack on Sony over the movie “The Interview.”


Katie Schroeder, a spokeswoman for Sony at Rubenstein Communications, declined to comment.


Shares of Sony surged 4 percent to 2,568.5 yen in Tokyo, extending this year’s gain to 41 percent.
Publishing accounts for 14 percent of Sony’s music revenue, the main part being recorded music. Sony Corp.’s Chief Financial Officer Kenichiro Yoshida raised questions about the future of music publishing in an Oct. 3 e-mail to his boss, CEO Kazuo Hirai, and Lynton, in a prelude to a meeting of the three, according to messages released by the hackers.

Sony Deliberations

“I’d like to hear your thoughts on the Music Publishing business, which has a rather complex capital and governance structure and is impacted by the market shift to streaming,” Yoshida wrote in the message.


Sony’s deliberations on the publishing business were included in a planning document sent to at least half a dozen Sony executives, according to the Nov. 21 e-mail. That included a presentation that outlined they were considering the sale.


“We are very surprised that the attached listing includes the commentabout the sale of Sony/ATV,” Kober wrote. “As you know quite well, this is a top-secret project that is being handled by me working directly with Michael and Nicole.”

The publishing division includes Sony/ATV Music Publishing and EMI Music Publishing.

http://www.bloomberg.com/news/artic...-to-sell-music-publishing-unit-owning-beatles
 
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InvincibleMJ

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That MJ said it is not an assumption. He did.

That Sony indeed killed him for his catalogue IS an assumption however. There is nothing that links Sony to MJ's death.

Thank you respect, I agree. Everyone is entitled to believe anything they want about the circumstances behind MJ's death and I believe Michael had good reasons to hate Sony back in 2002, I don't like them either. However using his words at the time to prove they killed Michael and this deal is a conspiracy is taking it a bit too far when you're telling other fans that they don't have a third eye and that it's wrong to "assume" things on others.
 

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Thank you respect, I agree. Everyone is entitled to believe anything they want about the circumstances behind MJ's death and I believe Michael had good reasons to hate Sony back in 2002, I don't like them either. However using his words at the time to prove they killed Michael and this deal is a conspiracy is taking it a bit too far when you're telling other fans that they don't have a third eye and that it's wrong to "assume" things on others.
I appreciate that you agree with me about 2002, but in my view, the passage of time, alone, doesn't stop something from being. If I am 'guilty' of taking Michael's words to the bank, then I gladly stand guilty as charged. I believe that believing the victim is not assuming. I believe that just stating that someone didn't read the thread is assuming. I believed Michael wasn't a child molester before his trial. Before what would be widely regarded as evidence..even though there are still some out there who think it wasn't enough evidence..though I believe they were wrong. I stand by the idea that believing a victim is not an assumption. You just stated that I am entitled to believe what I want about the circumstances surrounding MJ's death, and that's what I'm doing, but you, at the same time, are saying I'm taking it too far, by calling it a conspiracy..(which Michael called this whole scenario in that video and a 60 Minutes interview with Ed Bradley) at the same time. Now we can go back and forth about who is a victim in many cases, but in the case of Michael, which is what I'm focusing on, he never perpetrated anything against anyone. And whatever was attributed against him was initiated by another party. But since I know I would be told not to veer from the subject at hand..which is this catalogue transfer..It's clear that Michael intended to buy something to keep, and his lawyer knew that, and operated otherwise. Every argument I put forth is based on Michael's own statements. That's my evidence. He hasn't disappointed me, in the past. Of course, people are entitled to disagree with me, but this is where I stand. If someone was coming after you, doing bad things, and you proved to me, in the past that you were right about your claims about these bad things, and, so, I believed you, is that an assumption? I realize it's a tough grind to define what an assumption is, but in my view, it's worth the challenge. If I don't believe your claims, and I decide to not do anything about it, or I don't know what to think, and, therefore, I don't do anything about it....you see where I'm going here? I'm always scared to challenge a mod in a debate/argument, but these are my beliefs.
 
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