It’s official: New Mountain Capital has completed its acquisition of US performing rights organization, Broadcast Music, Inc. (BMI).
NMC, which has over USD $45 billion in assets under management, confirmed in November that it will “lead a shareholder group” to acquire a majority stake in BMI.
The NMC transaction was subject to approval by BMI shareholders and customary regulatory approvals and was expected to close by the end of this quarter (Q1 2024).
According to an update issued on Thursday (February 8), the deal has now received the necessary shareholder and regulatory approvals required for closing.
As reported in November, as part of the transaction, BMI’s former shareholders will be allocating $100 million of the proceeds of the sale to the PRO’s songwriter, composer and publisher “affiliates” in “recognition of [their] creativity”.
The allocation of those funds is expected to be made this spring.
According to Thursday’s announcement, “while not a distribution of royalties, the allocation will be in keeping with BMI’s distribution methodologies, which are based on performance levels over a set period of time”.
As reported in November, BMI’s official announcement at the time revealed that NMC’s ‘shareholder group’ included an arm of Google parent Alphabet.
As part of New Mountain’s investment, a BMI press release confirmed that CapitalG – aka Google/Alphabet’s “independent growth fund” – would acquire a passive minority stake in the PRO.
CapitalG has previously invested over $4 billion into 55 companies, including the likes of Airbnb, Stripe and Lyft.
BMI and NMC didn’t put a specific price on the takeover in the announcement today. Sources have previously put the acquisition price in NMC’s offer at around $1.7 billion.
“Our partnership with New Mountain charts an incredibly exciting new course for BMI and our songwriters, composers and publishers,” said Mike O’Neill, who will remain President & CEO of BMI.
“New Mountain shares our vision to build value for our affiliates and invest in their future success.”
Mike O’Neill, BMI
Added O’Neill: “New Mountain shares our vision to build value for our affiliates and invest in their future success.
“With their support, advanced level of innovation and resources, we are now in the best possible position to accelerate our growth plan and explore new opportunities to benefit our creative community.”
“We believe in BMI’s mission and the music creators they represent, and we are looking forward to helping BMI build on their momentum to deliver maximum value to their affiliates.”
Pete Masucci, New Mountain
Pete Masucci, Managing Director at New Mountain, added: “We are thrilled to officially begin our partnership with BMI.
“We believe in BMI’s mission and the music creators they represent, and we are looking forward to helping BMI build on their momentum to deliver maximum value to their affiliates.”
“Mike O’Neill and his team have set a dynamic path forward for BMI.”
Mike Oshinsky, New Mountain
Mike Oshinsky, Director at New Mountain, added: “Mike O’Neill and his team have set a dynamic path forward for BMI.
“We are excited to help modernize the performing rights space and support BMI’s mission of serving songwriters, composers and publishers and growing their royalty distributions for the long-term.”
US radio giant iHeartMedia is also lined up for a USD $100 million windfall from the sale of BMI.
On Monday, November 27, iHeart said that it expects, following the sale, to receive “approximately” $100 million of proceeds “related to its equity interest in BMI, subject to approval of the transaction by BMI shareholders and customary regulatory approvals”.
The US broadcaster added that it plans to use the proceeds for “general corporate purposes, which may include the repayment of debt”.Music Business Worldwide
