LONDON, Nov. 7 (UPI) -- The Sony Music Corp. and Bertelsmann's BMG have announced the signing of a letter of intent to merge their recorded music operations in a 50-50 joint venture.
The Financial Times (London) said the surprise Friday announcement came as executives of Time Warner and EMI, the British-based music group, were to meet to discuss details of their anticipated joint deal.
Although Sony and BMG have only signed a non-binding letter of intent, the Times said the deal raises the prospect that competition authorities on both sides of the Atlantic will be asked to rule on mergers involving four of the music industry's five largest companies.
European regulators three years ago blocked attempts by EMI to merge with Warner Music and BMG.
The Financial Times reported Rolf Schmidt-Holz, the BMG chief executive who will be chairman of the combined Sony BMG, denied the move is an attempt to scuttle a Warner-EMI merger.
He said: "Two parents like Sony and Bertelsmann and two entities like Sony Music and BMG don't make tactical moves like this. For a couple of thousand people you cannot play around."
