Chrysalis in £107m takeover deal

LONDON music group Chrysalis has today agreed a £107.4m takeover deal, ending weeks of speculation over its discussions with potential buyers.

The publisher, which owns the rights to songs by artists such as David Bowie and Michael Jackson, is being bought by BMG Luxco, a joint venture formed from German media group Bertelsmann and private equity firm Kohlberg Kravis Roberts.

Chrysalis co-founder and chairman Chris Wright hailed the takeover as “the end of one era and the start of another” for the company.

The deal prices Chrysalis shares at 160p each, a premium of 45.5 per cent on its 110p value at 29 October.

The share price has risen steadily since then on speculation, and after Chrysalis confirmed early stage talks were talking place in a statement issued on 1 November.

Chrysalis shares dropped slightly today to trade at about 158p.

BMG, which owns the rights to music by artists including Britney Spears and Coldplay, said the deal was “an important step forward in our strategy as we build a major, global music rights business.”

BMG chief executive Hartwig Masuch said: “Chrysalis’ extensive and high quality catalogue represents an excellent fit with our existing business.”

Wright founded Chrysalis as a record label in 1969 aged 24 with Terry Ellis, a university friend.

Chrysalis sold its same-name record label to EMI in 1991, sold book publishing operations to Anova Books in 2005, and sold Chrysalis Radio to Global Radio for £170m in 2007, to leave only the international music publishing division.