Bertelsmann CEO: Music Arm Not For Sale

By | May 5, 2001 at 12:00 AM

Bertelsmann AG Chief Executive Thomas Middelhoff said in an interview published on Saturday that the company’s music division Bertelsmann Music Group (BMG) would not be put up for sale.

“There will be no sale of BMG,” Middelhoff said in an interview with German daily Sueddeutsche Zeitung.

The comments come after the collapse of a planned merger of BMG and Britain’s EMI Group earlier this week as the two groups failed to crack regulatory concerns.

Last July, Middelhoff said the sale of BMG could be possible under certain conditions but told Sueddeutsche Zeitung that the situation had changed after his company’s alliance with the U.S. Internet song-swapping service Napster six months ago.

“At the time (last July) I was worried that we could be sandwiched between unrestricted online distribution and the stagnation in the CD business,” he said.

“We are already market leader in digital music distribution.”

BMG ranks No. 5 on its own among the music majors, behind Universal Music Group, Sony Music Entertainment, EMI and Warner Music.

Earlier this week, the Chief Executive of BMG, Rolf Schmidt-Holtz, said the company was looking to make cooperation deals or small acquisitions following the collapse the EMI deal.

“We can easily cooperate with anybody. We have of course identified partners,” Schmidt-Holtz told Reuters in an interview.

Turning to Bertelsmann Group’s results for the full year ending June 30, Middelhoff said he expects a rise in net profit above the previous year’s 1.3 billion marks ($592.8 million).

He said sales are expected to rise by around eight billion marks to a total of slightly more than 40 billion marks.

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