Access Industries of Len Blavatnik, majority owner of Warner Music Group, has reached an agreement to sell 8.56 million shares of Class A common stock of WMG to Morgan Stanley.
The sale was announced yesterday (January 3), and was confirmed today at a price of $41.0 per share.
At this price, the sale of Blavatnik would have brought in $351.0 million for Access and its affiliates.
Warner Music Group itself has not sold any shares under the offering and will not receive any proceeds.
Morgan Stanley, as an underwriter, is now expected to sell the 8.56 million shares to investors through various channels.
Today’s news follows Access Industries’ sale of another tranche of WMG stock – 2.34 million shares, worth approximately $105 million – to Morgan Stanley in September 2021.
With this move combined with the latest sale of 8.56 million shares, Morgan Stanley has acquired nearly half a billion dollars worth of WMG stock from Access Industries over the past four months.
Len Blavatnik may not just be thinking about his immediate payday with these moves: Sources suggest he may be playing a strategic game to help drive Warner’s stock price higher.
Due to the limited liquidity (i.e. stock trading) of WMG stock today – with many long-term shareholders investing in the company – the prospect that Access Industries (via Morgan Stanley) releases millions of shares into the trading realm could increase interest in Warner shares and therefore, some say, push WMG’s share price higher as a result.
The initial impact, however, has been the opposite: Warner Music Group’s share price – at press time – is down a bit more 4% today (January 4) on the NASDAQ following the announcement of the sale of Access shares.
The 8.56 million shares sold in Access’ latest move is a small nugget of Len Blavatnik’s overall stake in Warner Music Group.
After WMG floated part of his company on NASDAQ in the summer of 2020, Access Industries (and its affiliates) owned hundreds of millions of shares representing 90% of the company’s stock – with Len Blavatnik personally retaining over 99 % of total shareholder voting rights.
UPDATE: Following the latest stock sale to Morgan Stanley, MBW has confirmed that Access Industries and its affiliates retain 365,701,589 common shares of WMG.
The $350 million that Len Blavanik has just cashed in represents more than 10% of the $3.3 billion that Access initially spent to acquire Warner Music Group in 2011.
Earlier this week, Warner Music Group announced that it had acquired the full David Bowie publishing rights held by the David Bowie Estate, for an estimated price of around $250 million.The music industry around the world