Warner Music Group & Bain Capital in Talks to Form $1 Billion Joint Venture to Buy Catalogs
Written by djfrosty on March 12, 2025
Warner Music Group (WMG) and Boston-based private equity firm Bain Capital are in advanced talks to form a joint venture worth around $1 billion to acquire music catalogs, according to three sources with knowledge of the talks.
Led by an equity investment from Bain, the joint venture will enable WMG to write bigger checks while spending less of its own money to acquire the catalogs it wants most.
A representative for WMG declined to comment, and a representative for Bain did not respond to a request for comment.
High interest rates and intense competition to own the rights to music from bands like the Red Hot Chili Peppers is leading major music companies to partner with outside investors to bolster their bids and assuage shareholders who may be put off by the price of a prized catalog.
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Some of the biggest catalog sales of all time occurred last year, with Sony Music acquiring Queen’s catalog and other rights for $1.27 billion. Earlier in 2024, Sony also acquired a stake in Michael Jackson‘s catalog for $600 million.
In many cases, music companies are looking to buy out an artist with whom they’ve worked for years and whose catalog they already partially own — like Sony Music did in 2022 when it bought Bob Dylan‘s master recordings. Owning more of the music’s intellectual property not only allows for more control over how the songs are used and licensed in the future, it prevents potentially embarrassing break-ups between record labels and their superstars.
The bidding wars have grown particularly pitched for master recording rights, which are more valuable today because streaming has extended the period that a song remains popular by several years, according to entertainment banking sources. Before streaming provided listeners with easy access to the entire universe of popular music and kept songs in regular rotation through playlisting, the revenue generated by a hit song’s master recording would fall off precipitously after its hype period waned.
A growing number of successful artists are also leaving major music companies to release music independently, have grown entire careers independently or have negotiated more favorable contracts with their major label partners, giving them more ownership of their master royalties. It all has some investors worried that the total addressable market of master royalties will grow more slowly in the future than in prior decades.
In early 2024, Universal Music Group (UMG) invested roughly $240 million to partner with Chord Music, a catalog investment company majority-owned by Dundee Partners, to give it similar flexibility to acquire catalogs off of its balance sheet and with financial help. The agreement gave UMG the administration and distribution business for the 60,000 music copyrights owned in Chord, and, in exchange for throwing its power as the world’s largest music company behind those assets to make them make more money, Dundee Partners became UMG’s long-term co-investment partner.
Sony Music has also partnered with institutional investors to help finance acquisitions, including Apollo, and WMG has explored investing in catalogs through outside vehicles as an early investor in both Tempo Music Group and Influence Media.
One of the financial engineers involved in structuring UMG’s deal with Chord was Michael Ryan-Southern. At the time, Ryan-Southern led Goldman Sachs’ investment banking team focused on the music industry. WMG hired Ryan-Southern last summer to serve as its head of corporate and business development, overseeing mergers and acquisitions.
Ryan-Southern’s team was key toWMG’s acquisition of Tempo Music, a $450 million deal announced on Feb. 6 that gives Warner the rights to songs by Wiz Khalifa, Florida Georgia Line and Brett James.
WMG’s ties to Bain Capital date back to 2004 when Bain was part of the investor group — also including Thomas H. Lee Partners, Edgar Bronfman, Jr. and Providence Equity Partners — to buy WMG for what was then $2.6 billion cash.