A year of change and turbulence in the music industry is not over yet.
Virgin Music Group, the global independent music division of Universal Music Group, has today entered into a definitive agreement to acquire Downtown Music Holdings for $775 million in cash.
The acquisition, which is subject to regulatory approvals, is expected to close in the second half of 2025.
“Upon completion, this transaction will bring together two industry-leading providers of client services and music technology, enhancing their offerings and capabilities to serve the independent music community,” said a statement.
“Justin Kalifowitz, Andrew Bergman and Pieter Van Rijn have built Downtown Music into one of the most diversified and respected operations in the world,” said JT Myers, co-CEO, Virgin Music Group. “This combination enables us to expand on the Downtown legacy and offer the independent music community a dynamic and innovative global infrastructure both in terms of service offering and territorial footprint, and we look forward to working with the Downtown team to serve independent entrepreneurs, artists and creators with an even broader portfolio of services.”
“On behalf of Andrew, Pieter and myself, it is very exciting for Downtown to be joining forces with Virgin Music,” said Justin Kalifowitz, founder, Downtown Music Holdings. “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.”
This is a tremendous recognition of the importance and vitality of independent music
Justin Kalifowitz
“It’s an exciting time for Virgin as we continue to build a next-generation music company for independent artists and labels,” said Nat Pastor, co-CEO of Virgin Music Group. “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.”
Downtown's technology and service offerings support creators and businesses in music creation, distribution, publishing, marketing, royalty collection, financing, accounting and payment services.
The deal follows Virgin Music's acquisition of Outdustry and its alignment with PIAS' Integral distribution and services division globally.
Downtown has more than 20 offices across six continents, with core divisions across Artist & Label Services, Distribution, Royalties & Financial Services, and Music Publishing. Its portfolio of businesses includes Fuga, Downtown Artist & Label Services, Curve Royalties, CD Baby, Downtown Music Publishing and Songtrust.
Downtown collectively serves over 5,000 business clients and more than four million creators in 145 countries.
Virgin Music Group and Downtown will offer a broadened and enhanced suite of services to clients, including digital & physical distribution; release marketing; business intelligence; neighbouring rights; synchronisation; royalties and rights management.
Virgin Music Group and Downtown Music will continue operating independently through a customary regulatory approval period, with the combination of the companies to occur following the deal closure.
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.
PHOTO: (L-R) JT Myers and Nat Pastor
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