UMG/Prince Deal Unraveling?
When Universal Music Group announced in February that it had completed a recorded-music deal with the estate of Prince Rogers Nelson, one particular deal point stuck out — and not in that good way. Not only would the company license the majority of the artist’s recordings since 1996, but also, “beginning [in 2018], UMG will obtain U.S. rights to certain renowned Prince albums released from 1979 to 1995” — the years that Prince was signed with Warner Bros. Records and released his most commercially successful recordings by far, including the albums 1999, Purple Rain, Parade, Batman and Diamonds and Pearls. As Variety reports, “That sentence sent reporters digging through their notes, pulling out their calculators and hounding reps for both record companies. Prince had cut a new deal with Warner in 2014 that sources say garnered him the rights to the majority of his work released on the label (albeit with certain key exceptions). So how was UMG’s claim possible?”
As the Variety piece also notes, “Ten weeks later, it turns out the deal may not be all it was cracked up to be. Sources say that representatives for Prince’s estate — including the estate’s initial, temporary administrator, Bremer Bank; Comerica Bank, its current administrator; and special advisers Charles Koppelman and L. Londell McMillan, the latter of whom led the recorded-music deal — may have misrepresented the terms of the Warner assets, and Universal may attempt to nullify the deal and seek a full refund of approximately $30 million. (The news was first reported by the Wall Street Journal.)”
If that happens, the estate and Comerica — which this week named a new special adviser, Spotify executive (and Lady Gaga’s former manager) Troy Carter — will be forced to put the recorded-music assets back up for auction. (A source tells Variety it is possible that Universal could simply revise the existing deal for a lower price, but such an outcome is unlikely.)
