Sony and BMG complete music merger

Sony and BMG, the music unit of the German media conglomerate Bertelsmann AG, said today they had completed the merging of their music businesses.

The new company, Sony BMG Music Entertainment, will rival Vivendi’s Universal Music Group for market share.

Sony BMG, which will be headquartered in New York, instantly becomes home to a stable of hit-makers, including Britney Spears, OutKast, Aerosmith and Travis Tritt.

The company also now controls a catalogue of works by music veterans like Elvis Presley, Miles Davis, Johnny Cash and Stevie Ray Vaughan.

Sony and Bertelsmann each own half of the new combined company. The deal did not include the parent companies’ music publishing, manufacturing or physical distribution businesses.

Sony’s recorded music business in Japan, SMEJ, was also not part of the new joint venture. The US Federal Trade Commission approved the merger last week.

Andrew Lack, Sony Music’s former chairman and chief executive, was named chief executive of the new company.

Michael Smellie, the former chief operating officer of BMG, and Kevin Kelleher, Sony Music’s former executive vice president and chief financial officer, were also retaining their positions.

Sony BMG Music Entertainment might cut as many as 2,000 jobs, according to published reports, in a bid to save €300m.