Bertelsmann AG's planned divestiture from the Sony BMG Music Entertainment Inc. joint venture is now complete, as Sony Corp. [SNE] announced that it had bought out the German media giant's 50% stake. The sale, rumored for months and announced Aug. 5, was approved by EU regulators in mid-September.
The newly renamed Sony Music Entertainment Inc. will be a wholly-owned subsidiary of Sony Corp. Bertelsmann's stake was valued at $900 million, but an additional $300 million in cash on the company's balance sheet pushed the value of the deal up to $1.2 billion.
The deal prematurely unwinds a joint venture announced in August 2004 and slated to last for five years. Bertelsmann had a stated goal of maintaining a return on sales of 10% for each of its business units, and its Sony BMG stake was thought to be underperforming.
Sony shares traded at a 52-week low of $28.00 this morning, off more than 8%. -- Paul Bonanos
Bertelsmann AG's planned divestiture from the Sony BMG Music Entertainment Inc. joint venture is now complete, as Sony Corp. [
