Downtown Music Holdings

Photo Credit: Downtown Music Holdings

Virgin Music Group, a division of Universal Music Group, has announced a definitive agreement to acquire Downtown Music Holdings for $775 million. The deal, expected to close in the second half of 2025, will bring together two leading providers of services and technology for independent labels, publishers, and music IP owners.

The acquisition, officially disclosed this (Monday) morning, will enable Virgin Music Group to expand its global footprint and enhance its offerings for independent artists and labels. The combined company will offer a far broader suite of services, including distribution, marketing, rights management, and royalty collection.

Downtown, founded in 2007, has grown into a diversified music services company with divisions spanning artist and label services, distribution, royalties and financial services, and music publishing. Thanks to a string of aggressive acquisitions over the years, Downtown’s portfolio now includes CD Baby, Soundrop, Curve, FUGA, Songtrust, Found.ee, Sheer Publishing Africa, and homegrown neighboring rights, studio, and artist and label services divisions.

Downtown currently manages more than 50 million music assets from virtually every country worldwide. It serves over 5,000 business clients and 4 million creators across 145 countries.

“This combination enables us to expand on the Downtown legacy and offer the independent music community a dynamic and innovative global infrastructure,” relayed JT Myers, Co-CEO of Virgin Music Group.

Justin Kalifowitz, Founder of Downtown Music Holdings, expressed enthusiasm about the deal, stating, “This is a tremendous recognition of the importance and vitality of independent music, and the value that our company brings to its clients every day.”

Indeed, the deal is happening alongside a growth spurt within the independent music sector, which is cramping the market share of major label artist releases. That has prompted a number of strategic changes from the major labels, with acquisitions another weapon to absorb those gains.

Nat Pastor, Co-CEO of Virgin Music Group, emphasized the company’s commitment to supporting independent artists and labels, stating, “This is an investment into the global independent music ecosystem and a commitment to nurture current and future creators and entrepreneurs with world-class support.”

The two companies will continue to operate independently until the deal closes, pending regulatory approvals. Goldman Sachs and Skadden, Arps, Slate, Meagher & Flom advised Downtown Music on the transaction, while Kirkland & Ellis, PwC, and Freshfields advised Virgin Music Group.