BILLIONAIRE Len Blavatnik’s Access Industries has won the auction to take control of Warner Music Group Corp with an offer of $8.25 a share, the company said yesterday.
The agreement values the world’s third largest music company’s combined equity and debt at around $3.3 billion (€2.23bn). The all-cash deal is expected to close in the third quarter.
Warner Music, whose artists include Bruno Mars, Green Day and Led Zeppelin, will become an autonomous unit of Access, alongside industrial assets in natural resources and chemicals as well as media and telecommunications.
Blavatnik fought off last-round bids from Tom and Alec Gores’ Platinum Equity/The Gores Group and Sony Corp in partnership with Guggenheim Partners and investor Ron Perelman.
Blavatnik is a long-time associate of Warner Music chief executive Edgar Bronfman Jr and his father. He was a director of Warner Music from 2004, when Bronfman led a buyout of the company from Time Warner Inc up until 2008. Before this latest buyout deal Blavatnik already owned around 2% of Warner Music.
Bronfman and private equity firms Thomas H Lee and Bain Capital Partners together hold around 56% of the company’s outstanding shares and have entered into a voting agreement with Access to vote in favour of the merger.
Access secured finance for the deal from Credit Suisse and UBS, who were also advisors on the deal. Warner Music was advised by Goldman Sachs and AGM Partners.
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