Universal Music Group has formally notified the European Fee of its intent to accumulate Downtown Music Holdings for $775 million, triggering a regulatory evaluation.
Though the deal falls beneath the EU’s traditional thresholds for antitrust scrutiny, authorities within the Netherlands and Austria referred it to the fee, which now should determine by July 22 whether or not the acquisition raises competitors considerations or can transfer ahead.
Downtown Music Holdings owns a number of key items of impartial music infrastructure, together with CD Child (direct-to-creator distributor), FUGA (B2B distribution), Songtrust (publishing admin) and Curve (royalty/monetary providers). If accepted, the acquisition would considerably develop UMG’s affect within the indie sector, complementing its latest majority stake buy in indie label group [PIAS]. The deal was first introduced in December by UMG’s Virgin Music division.
The proposed deal has set off alarm bells amongst indie labels and authorized consultants, who worry it’ll scale back market competitors and consolidate UMG’s energy. Critics argue that impartial artists and labels utilizing Downtown’s providers could also be compelled into UMG’s ecosystem, risking their autonomy and dealing with potential information privateness considerations.
Competitors legislation knowledgeable Amelia Fletcher has written to EU competitors chief Teresa Ribera, urging the fee to dam the merger. Fletcher argues that impartial artists and labels utilizing providers like those beneath the Downtown umbrella would face a tricky selection: keep and danger changing into depending on UMG, or depart and face excessive switching prices with restricted alternate options. Fletcher calls the deal anti-competitive and urges the fee to scrutinize it intently. “It is important that this anti-competitive course of is stopped,” Fletcher writes.
In a joint assertion released late last year, indie leaders together with Noemí Planas (WIN), Richard James Burgess (A2IM) and Darius Van Arman (Secretly Group) criticized the transfer as a consolidation of energy that undermines the independence and variety very important to musical innovation. They urged regulators to dam the deal, warning it represents a broader pattern of market dominance by UMG.
The fee might reply by launching a deeper investigation or requiring UMG to make concessions, similar to divesting elements of the acquired enterprise. UMG goals to shut the deal within the second half of 2025 however should first get hold of approval.