CEO, BMG Rights Management
After sweeping up publishers, ready to grow to major status with recorded music
Since late 2008, Hartwig Masuch has built Bertelsmann Rights Management into the fifth-largest music company in the world, with annual revenue expected to exceed $400 million. Most of that comes from music publishing — after making multiple acquisitions of midsize independent publishing companies — but revenue is expected to grow exponentially now that the company is rolling heavy into recorded music.
While it agreed in December 2012 to acquire Sanctuary and Mute’s catalogs, those deals, which gave it about 2,000 master album recordings, didn’t close until the company received regulatory approval in 2013.
The company began with about 150 master recordings held back from the sale of Bertelsmann’s share of the Sony-BMG merger to Sony.
Last year, BMG Artist Services started making big moves as well, issuing 30 releases, including Backstreet Boys’ “In a World Like This” and “The Jazz Age” by Bryan Ferry, whose remake of “Love Is the Drug” was picked for the soundtrack to “The Great Gatsby.” The company says it will issue more than 50 albums in 2014.
“Our mission is to put BMG on the map for recorded music in the same way it is for music publishing,” Masuch says.
BMG continues to be on the prowl for music publishing assets, acquiring most of Primary Wave for about $130 million, sources say.
Since it opened its doors, BMG has done a rollup of music publishing companies, buying out one large indie publisher after another, including Cherry Lane, Bug Music and Stage Three. Meanwhile, BMG is also pursuing organic growth through signings, a point that Masuch makes in every conversation.
Bertelsmann ended its joint venture with private equity firm KKR in 2013 and now solely owns BMG. With revenue heading toward $450 million, BMG may not yet be large enough to be considered in the same breath as one of the majors, but in three to five years’ time, the major music industry players may once again reach a four count.