Downtown Music Holdings, the parent company of Downtown Music Publishing and Songtrust, is acquiring AVL Digital Group and its portfolio of businesses, including CD Baby, AdRev, DashGo and Soundrop.
AVL’s client base includes over 900,000 artists, labels and other rightsholders, representing the largest independent sound recording catalog in the music industry.
Industry sources estimate that the deal is in the vicinity of $200 million.
Downtown’s acquisition of AVL’s portfolio of companies follows a year (2018) in which total revenue generated by ‘self-releasing’ independent artists was $643 million, according to figures published by MIDiA Research.
AVL Digital and its portfolio of companies will continue to operate as a separate subsidiary of Downtown Music Holdings following the acquisition.
AVL’s physical product divisions, Disc Makers, BookBaby, and Merchly, will be acquired in a separate transaction by the Disc Makers executive team as part of the newly-formed DIY Media Group.
Founded by CEO Justin Kalifowitz (pictured) in New York in 2007, Downtown’s publishing division is home to some of the most iconic songs in the world, including Gershwin & Heyward’s Summertime and John Lennon and Yoko Ono’s Imagine.
The company has also been growing a high-profile contemporary publishing portfolio via recent acquisitions, such as the Salli Isaak companies started by Nick Raphael and Jo Charrington in 2006 (home to Sam Smith collaborator Jimmy Napes and Paloma Faith) and more than 170 Ryan Tedder compositions – including cuts on Halo by Beyonce and Rumor Has It and Turning Tables by Adele.
In 2019, Downtown’s songwriters have been nominated for 18 Grammy Awards and scored multiple No.1 hit singles including Lady Gaga and Bradley Cooper’s Shallow.
Downtown’s royalty collection division Songtrust serves over 170,000 songwriters and music publishers across 1.6m song copyrights.
As a result of this acquisition, Downtown’s global footprint will include over 300 employees spanning 14 markets in North America, Europe, Asia, Australia, and Latin America.
There are also currently 25 job openings across AVL and Downtown and the company expects to increase its global headcount by an additional 10-15% in the next 12 months.
AVL will be led by CD Baby’s widely respected CEO Tracy Maddux, who is based in Portland, Oregon.
Downtown was advised by Perella Weinberg Partners and McDermott Will & Emery, while AVL’s advisors included Stephens Inc., The Raine Group and Offit Kurman.
“Beyond shared values, the acquisition of AVL expands upon our existing portfolio and represents Downtown’s strategy of developing and investing in preeminent music businesses serving the full spectrum of music creators.”
Justin Kalifowitz, Downtown
Downtown Founder and CEO Justin Kalifowitz said: “Tracy and his team have built a portfolio of music businesses operating at unmatched scale.
“AVL’s technology, diverse offerings and artist-first approach are well-positioned to power some of the fastest growing segments of the industry.
“Beyond shared values, the acquisition of AVL expands upon our existing portfolio and represents Downtown’s strategy of developing and investing in preeminent music businesses serving the full spectrum of music creators.”
“This transaction will allow us to take the services we offer the independent music community to the next level.”
Tracy Maddux, AVL
Tracy Maddux added: “This transaction will allow us to take the services we offer the independent music community to the next level.
“We are excited to continue to build leading platforms that help artists release, promote and monetize their music all around the world.”
Picture credit: Stephanie SeveranceMusic Business Worldwide
