Switzerland-headquartered fintech firm Utopia Music has made its latest acquisition, this time buying UK warehouse, fulfillment, distribution firm Cinram Novum.
Utopia says that the deal saves the UK company from insolvency and secures 300 jobs.
Utopia Music, through its UK-based Utopia Distribution Services unit, will take over the business and certain assets of Cinram in a pre-pack administration deal, according to a release issued on Tuesday (September 13).
Financial terms of the buyout deal were not disclosed.
Cinram provides warehouse, fulfillment, distribution and business services to independent and major record labels including Universal Music Group and Sony Music Entertainment.
It also counts Cargo Records, PIAS, Elevation Sales, 88 Films, Sony Pictures, 101 Films, Fractured Visions, Screenbound, Trinity Creative Partnership, Morrisons and Sparkling Pine, as well as large retailers, and artists among its clients.
Utopia’s purchase of Cinram came about five years after the distributor of physical music and film DVDs went into administration and was subsequently acquired by Patriot Group Investments.
The latest deal saves the company from insolvency, securing 300 jobs, according to Utopia.
Cinram’s financial woes come amid the advent of streaming services like Spotify and Apple Music.
In recent years, supermarkets in the UK have started scaling back on the amount of physical music they sell due to the shift in music consumption trends.
“The loss of Cinram Novum would have been detrimental to the entire UK music industry, resulting in financial losses and disruption for labels, retailers, artists and their fans.”
Roberto Neri, Utopia Music
But Utopia Music remains bullish on the potential for physical music distributors. The purchase of Cinram will expand Utopia’s distribution services business after previously buying UK-based physical and digital music distributor Proper Music Group and Absolute Label Services, another UK-based distribution and services provider for independent artists and record labels.
“The loss of Cinram Novum would have been detrimental to the entire UK music industry, resulting in financial losses and disruption for labels, retailers, artists and their fans,” Roberto Neri, Chief Operating Officer of Utopia Music, said.
“Through this acquisition, our intention is that Utopia can secure Cinram’s future and safeguard the UK music industry,” Neri added.
Utopia also says that the Cinram deal is the latest in its efforts to optimize the music ecosystem including by minimizing its carbon impact.
Cinram says it was the first in the UK to offer so-called dropship fulfillment services to suppliers and customers in the UK via its API-driven logistics platform. Through this service, products are shipped directly to customers from Cinram’s warehouse, cutting stages in the supply chain.
The Cinram deal marks Utopia’s latest acquisition in the music industry after a string of buyouts in recent months. The company describes itself as a fintech firm that is “leveling up the music industry through clear, transparent, and reliable data-based solutions.”
The firm has over the past snapped up a number of companies in the music industry including British music publisher and publishing administration company Sentric Music Group, US-based music industry directory ROSTR, and Austria-based music data analytics platform ForTunes.
MBW recently reported, citing sources, that Utopia is raising €300 million in a series C funding round, valuing it at around €2.5 billion.Music Business Worldwide
