Virgin Music Group closes purchase of Downtown
TL;DR
Virgin Music Group has completed its $775 million acquisition of Downtown Music after European Commission approval, requiring the divestiture of Curve Royalty Systems to address competition concerns. The deal merges Downtown's services with Virgin's to create an expanded platform for independent artists and labels, despite criticism from some industry groups about market concentration.
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Virgin Music Group closes purchase of Downtown
Virgin Music Group Completes Acquisition of Downtown Music Amid Regulatory Conditions
Virgin Music Group, the independent music division of Universal Music Group (UMG), has finalized its $775 million acquisition of Downtown Music Holdings LLC, following European Commission (EC) approval with conditions. The deal, initially announced in December 2024, required regulatory scrutiny due to concerns over market concentration and data access. The EC mandated the divestiture of Downtown's Curve Royalty Systems to address fears that UMG could gain access to competitors' sensitive data.
Downtown, a global music services provider with operations in 145 countries, offers distribution, publishing, and royalty management services to over 5,000 business clients and 4 million creators. The acquisition merges Downtown's assets—including FUGA, CD Baby, and Songtrust with Virgin's existing infrastructure to create an expanded end-to-end platform for independent artists and labels. Virgin Music Group emphasized the transaction would enhance service offerings and global reach for independent entrepreneurs.
The EC's approval, announced on February 13, 2026, required UMG to sell Curve as a standalone business to an independent buyer, ensuring continued competition in royalty accounting. Virgin and Downtown co-CEOs stated the combination would foster a "more open ecosystem" for independent creators. However, the deal faced opposition from parts of the independent sector, with critics warning of reduced competition and increased market concentration. Over 200 industry leaders expressed concerns about data privacy and anticompetitive risks.
UMG and Virgin maintained that the indie services market remains fragmented, with multiple competitors such as Sony's The Orchard and Believe. Despite the EC's approval, trade associations like IMPALA criticized the outcome as insufficient to address long-term competition risks.
The transaction, now complete, underscores regulatory scrutiny of consolidation in the music industry while highlighting the strategic value of integrated services for independent stakeholders.
