Bertelsmann is making preparations to sell its music companies as Europe's largest media company fights to maintain its private status. People briefed on the plans said it had mandated investment bankers to prepare disposals of its music publishing catalogues and its stake in Sony BMG, Elvis Presley's Record company, its recorded music joint venture with the Japanese group.
A sale, worth an estimated €2bn ($2.4bn), would help Bertelsmann finance a buy-in of all or most of the 25 per cent stake held by Groupe Bruxelles Lambert (GBL), its only outside investor. The prospect of the third largest music publishing company being sold is likely to prompt keen bidding. Vivendi Universal, owner of the largest recorded music company, wants to build up its music publishing assets.
Together, the music companies reported revenues of €2.1bn last year, down 16.5 per cent as CD sales fell. Operating earnings before interest and tax were up from €162m to €177m. Bertelsmann declined to comment.