As Sony/ATV Mulls Over Sale, Questions Arise Over Martin Bandier's Succession
Despite record earnings, the publishing giant, run by Martin Bandier and co-owned by the Michael Jackson estate, could be changing hands. What happens next?
When Sony Entertainment CEO Michael Lynton announced on Oct. 8 the company had initiated a buy/sell process for Sony/ATV Music Publishing -- in which one of Sony/ATV’s two joint owners, Sony Corp. and the Michael Jackson estate, is obligated to buy out the other or open up the bidding to additional parties -- all eyes turned to veteran chairman/CEO Martin Bandier. Would the 74-year-old head of the country’s top music publisher survive a changing of the ownership guard?
While both Lynton and Bandier sent reassuring memos to their staffs -- with Bandier’s boasting “our best years are still ahead of us” -- the buy/sell takes place against a backdrop that includes a new contract negotiation for Bandier (sources say his deal is up at the end of March 2016 and he’s pushing for an extension) and Lynton’s weariness with what insiders describe as a prima-donna attitude displayed by Sony Music executives in general.
In fact, sources say one reason Sony would want to sell its lucrative publishing business, which has an estimated value of $2 billion (its songwriters include Taylor Swift, Lady Gaga, Ed Sheeran, Lennon & McCartney and Leiber & Stoller) and has ranked as Billboard’s top publisher for more than three years, is because there is no succession plan in place for Bandier, who has spent his 40-year career in publishing.
Prior to taking the top job at Sony/ATV in 2007, Bandier spent 18 years at the helm of EMI Music Publishing and, in 2012, helped engineer the acquisition of his former employer. (Sony’s share of EMI is not a part of the buy/sell.)
Bandier has mentored a generation of top publishing executives during his decades in the business, and his top proteges, Jody Gerson and Jon Platt, are now running two of his competitors -- respectively, Universal Music Publishing Group (with revenue of about $1 billion) and Warner/Chappell Music (revenue of about $500 million). This, says an insider, leaves no obvious successor at Sony/ATV and reminds Sony upper management of the sting of Gerson’s departure in 2014 -- an exit many viewed as a failing on Bandier’s part.
Insiders point to several possible heirs apparent. Guy Moot, who serves as Sony/ATV’s president of U.K. and European creative, is said to be Bandier’s favorite. Other front-runners include Sony/ATV U.S. co-presidents Rick Krim and Danny Strick, CFO Joe Puzio, executive vp business and legal affairs Peter Brodsky and executive vp advertising, film and TV Brian Monaco. Another contender is John Branca, a trustee of the Jackson estate with John McClain. “Branca really wants to take this over,” says a source. While Branca’s relationship with Bandier had been close, a source says it has become strained in recent months due to Bandier quashing the estate’s voice in the Sony/ATV dealings. (Reps for Sony Corp. of America, Sony/ATV and the Jackson estate declined comment.)
Still, nearly all parties involved say it would be a mistake to count out Bandier -- who is indisputably one of the most powerful figures in music publishing history -- any time soon. "Marty has been successful for so long because he is great deal guy, a savvy business executive, and a champion of songwriters, which makes him valuable to the companies he leads," says a former employee. "He is also the rare leader who has been able to distinguish music publishing from the record company industry, and has been able to maintain independence from the record company parents."
A former competitor adds, "He's smart, competitive and has staying power. If Marty wants to get an artist or songwriter, he can be very nimble. He doesn't leave it to his people -- he works well with them in closing deals. That's a hallmark of his."
At the very least, plenty of people on the inside expect the Bandier's contract to be extended for the sake of continuity. “If you are launching this process, there are already enough moving parts,” says one source. Plus, his bargaining power is only so strong. Adds another insider: “There is no succession plan, and that’s by Marty’s design.”
A version of this article was first published in the Oct. 24 issue of Billboard.
With additional reporting by Shirley Halperin and Frank DiGiacomo.