BRUSSELS (Reuters) - EU antitrust regulators have formally set out their objections to Universal Music Group’s $1.9 billion bid for EMI’s recorded music unit, the music company said on Tuesday, a step that could force Universal to offer concessions to get the deal cleared.
The European Commission is examining the proposed takeover, which would combine Universal’s stars such as Lady Gaga and Rihanna with EMI’s catalogue, which includes The Beatles and Katy Perry.
“As part of the European Commission’s customary process when considering mergers, they have provided us today with a statement of objections,” Universal said in a statement, referring to the regulatory document.
“We are preparing a detailed response to the Commission’s statement which will address the concerns outlined in this procedural document. We will continue to work closely with the Commission and look forward to securing regulatory clearance,” it said.
Reuters had reported on June 13 that the Commission would send the statement of objections early this week.
Vivendi-owned Universal could promise to sell off catalogues or offer licensing deals with more favorable terms to rivals and online services.
EU regulators in April allowed a consortium led by Sony to buy EMI’s separate music publishing business after the group promised to sell some catalogues.
Last week, EU Competition Commissioner Joaquin Almunia expressed worries about the market power of the combined group, almost twice the size of its nearest rival in Europe, and its impact on the digital music market.
Independent labels and rival Warner are opposing the takeover. The Commission has set a September 6 deadline for its decision. The U.S. Federal Trade Commission is also reviewing the deal.
Reporting by Foo Yun Chee