German media group Bertelsmann AG۪s 50% stake in Sony BMG is being sold to Sony Corporation for $1.2 billion.
The move ends a joint venture formed in 2004 by merging Sony Music and Bertelsmann۪s BMG as a response to the shock of the Internet and digitisation that spread the power of recording and distributing music from the old hands to all comers.
Howard Stringer, Sony chief executive, said the reborn Sony Music would give the group “far more flexibility” to use music in its film and television units, and in electronics such as Play_Station and the Sony Ericsson Walkman mobile telephone.
Hartmut Ostrowski, Bertelsmann chief executive, said the move was “consistent with our new growth strategy” to reposition the company as a media-services group, possibly buying in to the growing educational market.
Sony said it would pay Bertelsmann $600m and allow it to take Sony۪s 50% share of Sony BMG۪s $600m cash reserves.