UMG Flags EU of $775M Downtown Deal, Triggering Antitrust Review

Universal Music Group has formally notified the European Commission of its intent to acquire Downtown Music Holdings for $775 million, triggering a regulatory review.

Although the deal falls below the EU’s usual thresholds for antitrust scrutiny, authorities in the Netherlands and Austria referred it to the commission, which now must decide by July 22 whether the acquisition raises competition concerns or can move forward.

Downtown Music Holdings owns several key pieces of independent music infrastructure, including CD Baby (direct-to-creator distributor), FUGA (B2B distribution), Songtrust (publishing admin) and Curve (royalty/financial services). If approved, the acquisition would significantly expand UMG’s influence in the indie sector, complementing its recent majority stake purchase in indie label group [PIAS]. The deal was first announced in December by UMG’s Virgin Music division.

The proposed deal has set off alarm bells among indie labels and legal experts, who fear it’ll reduce market competition and consolidate UMG’s power. Critics argue that independent artists and labels using Downtown’s services may be forced into UMG’s ecosystem, risking their autonomy and facing potential data privacy concerns.

Competition law expert Amelia Fletcher has written to EU competition chief Teresa Ribera, urging the commission to block the merger. Fletcher argues that independent artists and labels using services like the ones under the Downtown umbrella would face a tough choice: stay and risk becoming dependent on UMG, or leave and face high switching costs with limited alternatives. Fletcher calls the deal anti-competitive and urges the commission to scrutinize it closely. “It is vital that this anti-competitive process is stopped,” Fletcher writes.

In a joint statement released late last year, indie leaders including Noemí Planas (WIN), Richard James Burgess (A2IM) and Darius Van Arman (Secretly Group) criticized the move as a consolidation of power that undermines the independence and diversity vital to musical innovation. They urged regulators to block the deal, warning it represents a broader trend of market dominance by UMG.

The commission could respond by launching a deeper investigation or requiring UMG to make concessions, such as divesting parts of the acquired business. UMG aims to close the deal in the second half of 2025 but must first obtain approval.