Reservoir Media Management has acquired the 26,000 song catalog of First State Media Group in a deal that grows the company's catalog by one-third to about 75,000 titles.
The First State catalog includes the Wind-up Music publishing catalog, the Dimensional/Dreamworks music publishing catalog, the country catalog Teracel and the Sheryl Crow catalog.
Terms of the deal were not disclosed. But during the auction some bidders were speculating that the catalog would only go for about $35 million to $40 million, because BMG had acquired a contract from S1 that paid an annual $2 million fee in exchange for handling global administration through 2016.
As part of the deal, Reservoir bought out BMG's administration contract and is assuming responsibility for the First State songs immediately in North America, while BMG will handle international administration. According to sources, First State's catalog -- which includes songs like "The Twist," "Louie, Louie," "Take the 'A' Train," and "Disco Inferno," and songs by John Denver, the Carpenters, Creed, the Byrds, Evanescence and Bob Marley -- generates about $4.5 million in net publisher's share.
"Acquisitions like these provide the ideal combination of the scale and quality we consider when strategizing the growth of our company," Reservoir president Golnar Khosrowshahi said in a statement. "This deal is one of many more to come."
Reservoir COO Rell Lafargue is overseeing integration of the First State catalog into Reservoir's operation. "We anticipate a seamless transition," he said in a statement. "Our team and infrastructure are well positioned to take its catalog, identify new creative opportunities, and see them thrive."
Lafargue told Billboard that Reservoir's goal is to "diversify our catalog and scale up and this deal helps us with both."
Jason Somerville, managing director of Los Angeles-based boutique investment banking firm EIG, ran the auction for the catalog.