BMG Acquires Nashville Indie BBR Music Group, Home of Broken Bow Records and Jason Aldean
BMG has acquired Nashville-based indie BBR Music Group, home of Broken Bow and Stoney Creek Records, as well as music publishing arm Magic Mustang Music, in what amounts to the German-based rights management firm's largest label acquisition since forming in 2008.
Announced Monday, the deal gives BMG a strong foothold in Nashville, and in turn is expected to help BBR artists expand into international markets. BBRMG's associated labels boast a number of major recording artists, including Jason Aldean (Broken Bow), Randy Houser (Stony Creek), Joe Nichols (Red Bow) and Trace Adkins (Wheelhouse), among others.
Terms of the deal were not disclosed. While BMG made the initial offer, prompting founder Benny Brown to shop the label to others, and when the majors became involved the price was bid up beyond the $100 million that BMG initially tendered, according to sources.
Those sources say that Broken Bow generally turns in annual revenue of about $25 million-$30 million. Its big revenue generator is Aldean, who has sold nearly 11 million albums in the US., according to Nielsen Music since his eponymously titled debut album. According to sources, the last two or three albums by Aldean are in fact owned by the artist and are licensed to the label, while the first five or four albums are owned by Broken Bow and thus now owned by BMG.
Sources say that the licensed Aldean albums are likely for a 10-year term, which gives BMG a nice cushion to recoup its investment.
While BMG typically is conservative when pricing music assets it wants to buy, this deal gives BMG a Nashville infrastructure, something the company was lacking and one of the reasons it could be aggressive in price. Sources further suggest that Brown favored selling to an independent, over a major.
BBRMG will continue to operate from its Nashville headquarters. Founder Benny Brown will be stepping down as president/CEO of the label group, but will remain on as a consultant. CFO Paul Brown will do the same, while all other staff will remain in their positions and report to executive vp Jon Loba, who now reports to Zach Katz, BMG US' president of repertoire & marketing.
"Since 2001 I've been approached many times by various major labels wanting to purchase us," said Benny Brown in a statement. "The most important thing to me has always been my artists, my employees and my songwriters. They have always been my family and after meeting with [BMG CEO Hartwig Masuch] and Zach, I knew that I’d found the right partners to ensure my family stayed together and to also continue the BBR Music Group legacy."
Masuch said BBRMG's "philosophy and commitment to its artists fit perfectly with the new BMG," adding, "the combination of BBR Music Group and BMG gives artists and songwriters in Nashville and beyond a new route to the worldwide market. We will be the alternative so many artists are looking for."
Katz praised Brown and his team and said it was "only a matter of time" before BMG expanded its presence within the Nashville music industry. "Never did we imagine that we would be able to do so with such an extraordinary roster of artists and team members," he said.
This isn't BMG's first rodeo within the country music genre. The original BMG purchased RCA in 1986 and found success with numerous Nashville artists including Kenny Chesney and Alan Jackson. RCA later became a subsidiary of Sony-BMG before parent company Bertelsmann sold its 50 percent stake in the recorded music business back to Sony in 2008. That year, BMG launched BMG Rights Management.
BBRMG joins a BMG label roster that includes Infectious, Rise Records, Sanctuary Records, Vagrant, S-Curve and The End Records.
Editor's Note: This article has been updated with added detail about BBRMG's assets.