The bidding for all or parts of Warner Music Group
Bids have come in valuing the whole company around $3 billion on an enterprise value basis (both debt and equity). Bids for its Warner/Chappell song publishing unit have come in around $1.5 billion to $2 billion, according to a person familiar with the process.
Warner Music has an enterprise value of around $2.65 billion. Its top artists include Green Day, Red Hot Chili Peppers and Bruno Mars.
The world's No. 3 music company appointed Goldman Sachs and Alan Mnuchin's AGM Partners in January to explore sale options for the company after management was approached by a potential buyer.
More than five parties have got through to the second round of bidding which started this week, according to the source. Names include Platinum Equity, billionaire Ron Burkle's Yucaipa Co, billionaire Len Blavatnik and Sony Corp <6758.T> which is specifically interested in the song publishing unit.
One name that has been at the top of the list for the first round was private equity firm KKR
Another name not involved in the formal bidding process is Vivendi's
The bids for Warner Music come even as investors are watching out for the next move from Citigroup, which took control of rival music company EMI last month and is expected to put it up for sale soon.
Some industry watchers believe both companies being up for sale around the same time could reduce their selling prices.
Warner Music Chief Executive Edgar Bronfman is also keeping an eye on the EMI process with the view that his company might in fact end up buying EMI assets. One possible scenario could see Warner Music sell its Warner/Chappell song publishing unit and raise enough cash to buy all of EMI.
(Reporting by Yinka Adegoke; Editing by Richard Chang)