Sony and BMG merge
Bertelsmann AG and Sony Corporation have signed a "binding agreement" to combine their recorded music businesses in a joint 50-50 venture.
The new company will be known as Sony BMG but won’t include the parent companies’ businesses in music publishing, physical distribution and manufacturing. Sony Corp’s recorded music business in Japan, SMEJ, will also be excluded.
The merger is subject to regulatory approvals in the United States and the European Union.
"With the signing of a Letter of Intent both parties have agreed the Board of Directors of Sony BMG will be made up of an equal number of representatives from Sony and Bertelsmann," say the two in a statement.
"Rolf Schmidt-Holtz, currently Chairman and Chief Executive Officer of BMG, will serve as Chairman of the Board of Sony BMG. Andrew Lack, Chairman and Chief Executive Officer of Sony Music Entertainment, will be Chief Executive Officer of the new company."
