Warner Music Group has sold 75 percent of its shares in Spotify, for an estimated $400 million. WMG CEO Stephen Cooper stated that $300 million would go to shareholders, noting the company will share equity proceeds with distributed labels if that stipulation is included in their agreements.
Cooper also emphasized that Warner Music Group has full confidence in Spotify. “Just so there won’t be any misinterpretation about the rationale for our decision to sell, let me be clear: We’re a music company, and not, by our nature, long-term holders of publicly traded equity,” he said. “This sale has nothing to do with our view of Spotify’s future. We’re hugely optimistic about the growth of subscription streaming, we know it has only just begun to fulfill its potential for global scale. We fully expect Spotify to continue to play a major role in that growth.”
During the first quarter of 2018, WMG’s recorded music operations turned $791 million, and Warner/Chappell Music Publishing turned over $174 million in the first quarter.
The move follows a similar strategy from Sony Music earlier this year, when the company sold 17.2 percent of its Spotify shares, earning upwards of $260 million.
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