Sony Music have completed their purchase of Kobalt’s AWAL and Kobalt Neighbouring Rights for $430 million.
In February UK-based independent distributor, owned by Kobalt Music, as well as rights collection agency Kobalt Neighbouring Rights sold to Sony Music for $430 million. Last week, Sony Music confirmed the deal had completed.
As the confirmation of the purchase was announced, UK body Competition and Markets Authority (CMA) opened an investigation into the deal. “The CMA is investigating the completed acquisition by Sony Music Entertainment of the AWAL and Kobalt Neighbouring rights businesses from Kobalt Music Group Limited.” This could prove a difficult hurdle for Sony to overcome. There is currently no set deadline for phase 1 of the decision. The last music industry-related buyout that was investigated by CMA was Hasbro’s acquisition of Entertainment One for $4 billion. The purchase was cleared by CMA at the start of 2020
Sony Music Entertainment (SME) today announced that it has completed its acquisition of AWAL, a leading provider of services to independent recording artists, and Neighbouring Rights, one of the top performance rights collection agencies for artists and independent labels worldwide.Sony Music in a statement
AWAL and Neighbouring Rights will become a new division within SME’s suite of independent artist and label services offerings and will be enhanced by the technology and network of SME’s independent music distribution company, The Orchard. Lonny Olinick will remain AWAL’s CEO.
Prior to the closing of the acquisition, the UK Competition and Markets Authority (CMA) initiated a review of the transaction. SME continues to work closely with the CMA to secure a positive outcome later this year.
As the industry continues to shifts towards a streaming-first market, the sale shows major labels’ interest in the growing wave of independent artists and labels making a name for themselves without the backing from the likes of Sony, Universal or Warner.