Zomba Zaps 350 Staffers

By | March 29, 2003 at 12:00 AM

Zomba Music Group, home to teen-pop powerhouse Jive Records, will be saying “bye, bye, bye” to as many as 350 employees out of its 1,800-strong global staff over the next nine months as part of its long-awaited integration into parent company Bertelsmann Music Group.

The layoffs, which will be spread out evenly over the course of the year, are part of a larger effort to bring Zomba’s stable of imprints – including Jive, Verity, Silvertone and Volcano – into the major-label group’s worldwide infrastructure.

From a brand standpoint, Zomba will remain very much independent from BMG, with major imprints and creative staffs remaining intact. But most of the company’s back-office functions, such as sales, legal and business affairs, will get folded in with those of the corporate parent.

“We have made it a priority to preserve Zomba’s unique culture and identity,” BMG chief executive Rolf Schmidt-Holtz said in an internal memo. “We know they are vital elements of the company’s success. As such, the creative centers of Zomba’s Records and Publishing companies in the U.S. and U.K. will retain their independence within BMG, just as our other labels and publishing operations have for years.”

From a physical standpoint, Zomba offices outside the U.S. and U.K. will be absorbed into BMG’s global infrastructure, Schmidt-Holtz said. Meanwhile, the company’s Gotham offices will remain in their current location on 25th Street.

Many of Zomba’s top brass are staying put as well, including highly regarded president Barry Weiss, as well as Zomba Publishing head Richard Blackstone, Zomba Records U.K. head Steve Jenkins, Jive Records general manager Tom Carrabba and Nashville chief Joe Galante. More personnel announcements are expected “in the near future,” according to Schmidt-Holtz.

BMG became the somewhat reluctant owner of Zomba Music last November for a price of more than $2.7 billion after owner Clive Calder exercised a “put” option forcing BMG to buy his majority interest in the company.

The price, which was calculated as a multiple of Zomba’s revenues in past years, was seen as high by many industry observers, who reasoned that the company’s stable of hit pop acts like ‘N Sync and Britney Spears may be past its prime.

Indeed, BMG parent Bertelsmann took a major writeoff for the value of Zomba’s assets in its year-end financial results, released earlier this week. BMG itself had a strong year, swinging to a $130 million profit thanks to hit records from Avril Lavigne, Pink and Elvis Presley, among others.

Related Content