Warner Music Group is set to fully acquire one of Europe’s biggest music merch companies, EMP Merchandising Handelsgesellschaft mbH (EMP), in a deal worth $180m.
The news follows a string of recent buyouts at WMG, including A&R insight tool Sodatone, influential online media brand UPROXX, electronic music label Spinnin’ Records, and concert discovery platform Songkick.
According to a fresh 8-K investor filing spotted by MBW, Warner has agreed to pay a cash consideration of approximately €155m ($180m) for EMP, which may be adjusted based on the net debt and working capital of the firm.
The buyout is yet to be approved by the German regulatory authorities, but is expected to close in October.
EMP is currently owned by Sycamore Partners, a private equity firm based in New York.
Once the deal is finalized, EMP will become a standalone, direct-to-fan business unit within WEA, WMG’s global artist and label services division headed by President Tony Harlow. (WEA already runs its own in-house merch business, which Warner financially categorizes under ‘Artist services and expanded-rights revenue’ – a division which grew revenues by 5% to $385m in the firm’s FY2017, ended Sept last year.)
“EMP’s music-led expertise will give us great insight into what audiences love and what they want, and at the same time open up exciting new opportunities for our artists.”
Stu Bergen, WMG
EMP is led by CEO Ernst Trapp and CFO Jan Fischer, who will continue to manage the company as a fully staffed organization under Warner’s ownership.
Founded in Germany in 1986, EMP today offers fans merchandise from acts such as Twenty One Pilots, Panic! At The Disco, Metallica, Motörhead, Guns n Roses, Nirvana, Pink Floyd, AC/DC, The Doors, and many others.
Beyond music, the company has established itself as an online e-tailer, selling merch from major entertainment brands such as Disney, Marvel, Star Wars, and Harry Potter; gaming brands such as Nintendo and PlayStation; sporting franchises such as the NFL; and alternative fashion brands such as Vans.
The company operates a network of websites serving 18 European countries, with a community of millions of customers.
“EMP has built a powerful lifestyle destination that will be a perfect complement to our global artist development and marketing strategies,” said Stu Bergen, CEO of International & Global Commercial Services, Recorded Music, WMG.
“Their music-led expertise will give us great insight into what audiences love and what they want, and at the same time open up exciting new opportunities for our artists. We look forward to bringing Ernst, Jan, and everyone at EMP into WMG’s growing family of brands.”
“Welcoming EMP will be our latest move to expand our relationships with influencers across the globe.”
Max Lousada, WMG
“In today’s streaming world, merchandise is still one of the best ways that fans can express their passions and personalities,” said Max Lousada, CEO of Recorded Music, WMG. “It’s also a big part of how music has visible and physical impact on global culture and fashion. Welcoming EMP will be our latest move to expand our relationships with influencers across the globe.”
“It’s always been our goal to create the most authentic, exclusive products,” said Ernst Trapp. “Our team is made up of devoted fans who are curating the music, themes, and lifestyle brands that they know fellow fans will embrace.
“By joining WMG, we will be able to expand our international reach, explore new genres, reach new audiences, and take fan experience to a whole new level.”Music Business Worldwide
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