Vivendi’s Universal Music Group has been given the go ahead by the EU to buy EMI’s recorded music unit.
But European competition regulators said to avoid the combined group dominating the industry, it has to sell some of EMI’s most prized record labels and catalogues.
Universal said the assets to be sold bring in almost a third of EMI’s annual revenues and include the Parlophone label, home to such star acts as Coldplay, Pink Floyd, David Bowie and Queen.
Last year Universal and EMI together accounted for 41.5 percent of music sales revenue world wide.
Even with the sell-off of EMI labels, the deal will cement Universal’s leading position in the European music industry.
Likely buyers include all the usual suspects – Warner Music, BMG, Sony Music and Virgin founder Richard Branson.
The European Commission said buyers must be active record firms or those with a proven track record in the music industry, ensuring that there would be a strong rival to Universal.
This is not a done deal yet as the takeover still has to be approved by the US Federal Trade Commission.
Even though Brussels said the ruling “will ensure that competition in the music industry is preserved” the group representing Europe’s independent labels, Impala, complained it “reinforces an already a powerful duopoly” which will cost artists and consumers.