#TheWeeklyRoundUp - 08.08.25

EU opens in-depth investigation into UMG's $775m Downtown deal (Music Business Worldwide)

The European Commission has opened an in-depth investigation into Universal Music Group‘s proposed acquisition of Downtown Music Holdings.

The EC said in a press release on July 22 that it "has preliminary concerns that the transaction may allow UMG to reduce competition in the wholesale market for the distribution of recorded music in the European Economic Area (EEA) by acquiring commercially sensitive data of its rival record labels".

The Commission said that it is "also preliminarily concerned that the transaction may allow UMG to reduce competition in the market for the supply of artist and label services in the EEA by removing an important competitive force". UMG’s Virgin Music Group revealed in December that it had agreed to buy Downtown Music Holdings LLC in a $775 million deal.

The EC announced in April that it was preparing to investigate the proposed acquisition.

Last month, after UMG formally notified it of the deal, the EC set a provisional deadline of July 22 to make a decision in an initial 25-day Phase 1 investigation.

Today's news confirms a story published by Reuters last week that suggested the EC was preparing to launch a more extensive Phase II investigation lasting up to 90 working days.

The EC said today that it has until November 26, 2025 to make a decision, and that "the opening of an in-depth inquiry does not prejudge the outcome of the investigation".

A UMG spokesperson issued the following statement to MBW today:

“Virgin Music Group today received notice from the European Commission that it will open a Phase II investigation into Virgin’s previously announced acquisition of Downtown Music Holdings.

"A Phase II review is a customary part of the Commission’s merger review process in those cases where initial concerns about a transaction’s effects have not been resolved during Phase I.

"We remain confident that the combination of Virgin and Downtown will create an improved offering in the growing and highly competitive label services category that currently consists of roughly 100 companies, one that will provide a wide range of services to help independent artists, labels and entrepreneurs achieve their commercial and creative goals.

"We look forward to continuing to work constructively with the Commission to convey the benefits this transaction will bring to the independent community, as well as to address the wilful misrepresentation of market data by self-interested parties who represent a tiny fraction of the thousands of independent labels that make up the independent community globally.

"Our initial projected timeframe for the completion of the transaction remains unchanged.”