Sony Music pays US$430m for Kobalt’s recording, neighbouring rights
Sony Music’s indie operations have expanded after acquiring two of Kobalt Music Group’s divisions.
The US$430 million deal, subject to regulatory approval, sees Kobalt’s independent distribution and label division AWAL and Kobalt Neighbouring Rights rolled into a new entity connected with Sony’s indie distribution arm The Orchard.
“Our investment in AWAL’s continued growth gives us another level of service to offer the independent music community,” said Sony Music Group chairman Rob Stringer, who has long maintained the independent sector was a key strategy in the major’s growth.
“With their flexible solutions to building artist careers, together we will offer creators more exciting choices to connect with their audience worldwide.”
Added Orchard CEO, Brad Navin: “The Orchard’s comprehensive offerings, global footprint and technology will contribute to AWAL’s continued success.
“We will give more artists a transparent, global solution and access to multiple touch points to release their music however they choose.”
AWAL CEO, Lonny Olineck, and Neighbouring Rights CEO, Ann Tausis, remain in their roles.
AWAL will continue to sign, develop and market its own artists, and offer global marketing, creative, sync and brand partnerships, real-time comprehensive music analytics, radio promotion and distribution.
Its fee for basic distro is 15% of royalties generated by an artist and 30% for more services, while its top-tier offers AWAL Recordings, a “global record label built to break artists on their own terms”.
AWAL artists include You Me At Six, Lauv, Little Simz, Finneas, AG Club, and girl in red. It also previously handled Nick Cave & The Bad Seeds’ catalogue.
AWAL’s distribution and label services are mostly provided to individual artists while The Orchard provides those mainly to labels.
Olineck commented: “The AWAL team has futuristically enabled artists to deliver their creative vision since its inception.
“Now, as part of the global Sony ecosystem, we can dramatically expand on this vision for them.
“We are also excited to build on our innovative neighbouring rights as well as DIY platforms with extended support from The Orchard.”
Last year, Kobalt founder and chairman, Willard Ahdritz, put the entire company for sale on a US$1 billion valuation but got no takers.
He said after its new exit from the recording side: “As Kobalt moves forward under the leadership of our CEO, Laurent [Hubert], we are both excited for the big opportunities ahead across music publishing, (performing rights organisation) AMRA and (financial adviser) Kobalt Capital.”
The Sony deal means that Ahdritz now only has its music publishing, the AMRA performing rights organisation and financial adviser Kobalt Capital.
“Our team and capabilities will only grow stronger and play a continued role in making the industry better for creators.”