Madonna said to be near $120M deal
This is what the Associated Press writes about the Wall Street Journal’s report on Madonna being close to leaving Warner Bros. Records for a new deal with concert-promotion giant Live Nation Inc.
Madonna intends to sign a $120 million recording and touring deal with live entertainment promoter Live Nation Inc. and leave her longtime record label at Warner Music Group Corp., a person familiar with the contract negotiations said Wednesday.
The pop superstar’s management informed Warner last week that she would accept Live Nation’s offer after the record company refused to match the deal, said the person, who spoke on condition of anonymity because of the confidential nature of the matter.
Under terms of the proposed deal, Madonna, 49, would receive a signing bonus of about $18 million and a roughly $17 million advance for each of three albums, the person said. A portion of the compensation would involve stock, the person said.
Madonna could also benefit significantly from the touring component of the deal, which gives Live Nation the exclusive right to promote her tours, the person said.
In a bid to compete with the Live Nation offer, Warner pursued a possible partnership with ticket retailer Ticketmaster, a unit of IAC/InterActiveCorp, that would have enabled the record company to offer a spectrum of touring services to Madonna, the person said.
Warner Music and Live Nation declined to comment. A call to Madonna’s publicist was not immediately returned.
The proposed 10-year agreement would give Live Nation the rights to sell Madonna merchandise and license her name, and any revenue from such products would be split between the singer and the company, The Wall Street Journal reported, citing unnamed people familiar with the deal.
Live Nation also would have to pay $50 million in cash and stock to promote Madonna’s tours, according to the Journal, which broke news of the deal on its Web site Wednesday afternoon.
The agreement would be in line with similar deals other artists have struck with labels in recent years that give record companies a stake in their artists beyond the sale of recordings.
Live Nation, which promotes and produces music shows, theatrical performances and other live events worldwide, has been looking to expand beyond its core businesses to offer artists services such as direct merchandising and exclusive ticket sales. Its Artist Nation division sells tickets and artist merchandise online.
Warner has also set out to strike deals with artists and other music industry players in a bid to garner a share of revenue from other segments of the music industry, such as merchandising and touring. Those segments are faring better than recorded music sales.
Madonna first signed with Warner Music Group subsidiary Warner Bros. Records in 1984. Her last contract with the New York-based company calls for her to deliver one more studio album, expected next year, and a greatest hits record.
The singer has been among Warner Music’s best-selling artists for years and arguably remains pop music royalty. Losing the rights to release her new recordings could prove to be a significant blow to the company’s bottom line.
Warner, however, retains the rights to sell and license her catalog of hits such as “Like a Virgin” and “Music.”
Warner shares rose 11 cents to $11.29 Wednesday. Shares of Live Nation fell 32 cents, or 1.4 percent, to $23.36, then gained 64 cents in after-hours trading.
From an article by Alex Veiga, AP Business Writer, via Yahoo! News.