{"id":130199,"date":"2022-05-05T20:38:56","date_gmt":"2022-05-05T19:38:56","guid":{"rendered":"https:\/\/www.musicbusinessworldwide.com\/?p=130199"},"modified":"2022-05-05T20:41:04","modified_gmt":"2022-05-05T19:41:04","slug":"confirmed-sony-music-paid-universal-e102-million-for-stake-in-todd-moscowitz-alamo-records","status":"publish","type":"post","link":"https:\/\/www.musicbusinessworldwide.com\/confirmed-sony-music-paid-universal-e102-million-for-stake-in-todd-moscowitz-alamo-records\/","title":{"rendered":"Confirmed: Sony Music paid Universal \u20ac102 million for stake in Todd Moscowitz’s Alamo Records"},"content":{"rendered":"

One of the biggest music industry stories of last year was the majority-acquisition<\/a> of Todd Moscowitz’s Alamo Records by Sony Music Entertainment.<\/p>\n

New York-based Alamo was founded in 2016 and has broken artists including Blackbear, Lil Durk and Rod Wave.<\/p>\n

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At the time that deal went down, there were some conflicting reports from sources regarding the size of the transaction: Some sources suggested it could have been as big as $250 million<\/strong> in total, others said this suggested figure was significantly higher than the amount of money Sony actually paid.<\/p>\n

Now, we have some confirmed clarity on the deal, which was announced in June 2021.<\/p>\n

According to a line in Universal Music Group’s recently-issued annual fiscal report spotted by MBW, Sony Music paid Sony Music EUR \u20ac102 million<\/strong> to buy UMG’s interest in Alamo.<\/p>\n

At the average currency conversion rate for June 2021 (via OFX<\/a>), that figure would have translated to USD $123 million<\/strong>.<\/p>\n

This USD conversion is likely imperfect; if MBW had to bet, we would assume it indicates the 50% Alamo equity was acquired by Sony from UMG for USD $125 million.<\/strong><\/p>\n

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Here’s where things get interesting.<\/p>\n

In Sony Music’s announcement of the deal last summer, the company confirmed that it had acquired a majority<\/em> stake in Alamo.<\/p>\n

It’s understood that Universal held a 50%<\/strong> ownership stake in Alamo, with the other 50%<\/strong> being owned by Moscowitz in a joint venture agreement.<\/p>\n

This must mean that Sony acquired the UMG stake, plus additional equity<\/strong> from Moscowitz himself.<\/p>\n

With our reasonable certainty that Sony paid USD $125 million<\/strong> for the 50% stake, we can confidently slap a pre-transaction valuation on the whole of Alamo of $250 million<\/strong>.<\/p>\n

What this consequently means:<\/p>\n

  • If Sony acquired an additional 25% from Moscowitz on top of the UMG piece (to take Sony’s total stake in Alamo to 75%<\/strong>), Sony’s overall spend on the deal would have been approximately $188 million<\/strong>.<\/li>
  • If Sony acquired an additional 30% from Moscowitz (to take Sony’s total stake in Alamo to 80%<\/strong>), Sony’s overall spend on the deal would have been approximately $200 million<\/strong>.<\/li>
  • And if Sony acquired an additional 40% from Moscowitz (to take Sony’s total stake in Alamo to 90%<\/strong>), Sony’s overall spend on the deal would have been approximately $225 million<\/strong>.<\/li><\/ul>\n
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    Sony and Alamo Records recently scored a major US hit with Lil Durk’s 7220<\/em> album, which hit No.1 on the Billboard 200 in March.<\/p>\n

    In its opening week in the States, the album shifted 120,500 album-equivalent sales, according to Billboard.<\/p>\n

    The album features guest appearances from Future, Gunna, Summer Walker, and Morgan Wallen.<\/p>\n","protected":false},"excerpt":{"rendered":"

    A new nugget of information emerges – and MBW does the math<\/p>\n","protected":false},"author":3,"featured_media":27423,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[9,7],"tags":[],"class_list":["post-130199","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","category-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/posts\/130199","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/comments?post=130199"}],"version-history":[{"count":0,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/posts\/130199\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/media\/27423"}],"wp:attachment":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/media?parent=130199"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/categories?post=130199"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/tags?post=130199"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}