Uniting Independent Music Powerhouses for a Brighter Future
Background and Significance
Justin Kalifowitz, Andrew Bergman, and Pieter Van Rijn have masterfully built Downtown Music into one of the most diversified and respected operations globally. This acquisition by Virgin Music Group presents a unique opportunity to expand on the Downtown legacy. As JT Myers, Co-CEO of Virgin Music Group, stated, "This combination enables us to offer the independent music community a dynamic and innovative global infrastructure, both in terms of service offering and territorial footprint." It's a testament to the importance and vitality of independent music.
Justin Kalifowitz, the Founder of Downtown Music Holdings, expressed his excitement about the partnership. He said, "This is a tremendous recognition of the importance and vitality of independent music, and the value that our company brings to its clients every day. Downtown was established with the belief that artists and entrepreneurs everywhere and at every stage are entitled to the same tools and opportunities to succeed. We have no doubt that the breadth and high level of service Downtown provides to its clients will be strengthened working with Nat, JT, and the whole Virgin Music team."
Virgin Music Group's Vision
Nat Pastor, Co-CEO of Virgin Music Group, emphasized the significance of this acquisition. He said, "It's an exciting time for Virgin as we continue to build a next-generation music company for independent artists and labels. We aren't just making an acquisition; this is an investment into the global independent music ecosystem and a commitment to nurture current and future creators and entrepreneurs with world-class support, services, and capabilities they require at any phase of their careers."
The journey of Downtown Music began in 2007 as a music publishing company. In 2021, it sold those interests to Concord and focused on artist services and other infrastructure-related operations. Recognizing the need for resources among artists and labels who own their intellectual property but lack the means to distribute and administer it, Downtown has emerged as a crucial player. With more than 20 offices across six continents and core divisions across Artist & Label Services, Distribution, Royalties & Financial Services, and Music Publishing, Downtown serves over 5,000 business clients and more than four million creators in 145 countries.
Services Offered
According to the announcement, Virgin Music Group and Downtown will offer a broadened and enhanced suite of services to clients. These include digital & physical distribution, release marketing, business intelligence, neighbouring rights, synchronization, royalties, and rights management. This comprehensive package is set to benefit both established and emerging artists and labels.
During the customary regulatory approval period, both companies will continue to operate independently. Once the deal closes, the combination of the companies will bring together their strengths and create a powerful force in the music industry.
Advisory and Legal Support
Downtown Music was advised in the transaction by Goldman Sachs & Co. LLC and Skadden, Arps, Slate, Meagher & Flom LLP. Virgin Music Group was advised by Kirkland & Ellis LLP, PwC, and Freshfields. This expert legal and financial support ensures a smooth transaction and lays the foundation for a successful partnership.