Mathew Knowles has reclaimed control of MWE. British-based independent music firm Sanctuary Group plc said today (July 6) it has sold MW Entertainment, Productions and Management Inc (MWE) to Knowles
Mathew Knowles has reclaimed control of MWE. British-based independent music firm Sanctuary Group plc said today (July 6) it has sold MW Entertainment, Productions and Management Inc (MWE) to Knowles for $5 million.
In a statement, publicly-listed Sanctuary explained that $3 million had already been paid, with the remaining $2 million to change hands by the end of 2007.
Knowles has also agreed to sell his 17,829 shares in Sanctuary within two weeks, and return the proceeds to the company. Sanctuary's shareprice was trading at 18 pence this afternoon, down 2.5 pence.
As a result of the deal, Knowles now regains management control of "certain" urban artists contracted to MWE, including his daughter Beyonce and her band Destiny's Child.
"This is another important step in reorganizing the group and putting it on a sustainable footing with proper standards of corporate governance and financial transparency," Sanctuary chief executive Frank Presland said in the statement.
"This is a business that can prosper if it faces up to the new realities and management remains committed to focusing on driving the business forward to deliver appropriate levels of performance."
Sanctuary originally acquired Houston-based MWE from Knowles in 2003. That deal, worth $10 million, saw Knowles appointed president of a new Urban division at Sanctuary.
At the time, the move was trumpeted by the group as a bold step into the urban music genre. In time, however, the alliance turned out to be a thorn in Sanctuary's side and the partnership ultimately turned sour. Earlier this year, Sanctuary heaped blame on its Urban Records Group for contributing to "substantial" financial losses for the group. The fledgling urban records unit was subsequently shuttered.