Michael Jackson said near deal to avert bankruptcy
NEW YORK, Apr 13 (Reuters) Michael Jackson is close to a deal that would help him to avert bankruptcy by refinancing his debts and possibly selling part of his interest in scores of hits by The Beatles, The New York Times said today.
The paper, citing people briefed on the plan, said the ongoing negotiations to refinance hundreds of millions of dollars of loans would require him at some point in the future to offer Sony Corp.
part of his interest in a song catalog that includes many of The Beatles best-known songs.
Jackson, who was cleared last June of criminal charges of sexually abusing a young boy at his Neverland Valley Ranch, has spent much of his time since the trial in Bahrain.
Prosecutors asserted during Jackson's child molestation trial the pop singer was in precarious financial shape due to mounting debts.
He narrowly escaped legal action by the state of California earlier this year for failing to pay employees at his ranch.
California's labor commissioner had fined Jackson 100,000 dollars and threatened to sue the 47-year-old entertainer unless he made good on at least 306,000 dollars in back wages dating to December. He paid the salaries last month.
The former child star who became one of the biggest pop stars in the world, selling an estimated 300 million albums, had been increasingly under scrutiny even before the trial as media attention turned to his eccentric lifestyle and dramatic changes in his physical appearance.
The trial was an international media circus with Jackson facing nearly two decades in prison if convicted of 10 counts of lewd acts with a child, giving a minor alcohol and conspiring to commit child abduction, extortion and false imprisonment. He was cleared on all counts.
SONY DEAL Jackson bought the ATV catalogue, which included more than 200 songs written by members of The Beatles, for 48 million dollars in 1985. He caused some controversy when he subsequently licensed their 1968 song ''Revolution'' to a Nike commercial.
In 1995, Sony and Jackson formed a joint venture combining Sony Music Publishing and the ATV Music Publishing catalogue, which also includes thousands more songs by the likes of Little Richard, Bob Dylan and Elvis Presley.
Music publishing is one of the most lucrative areas in the music industry and involves the exploitation of song copyrights. A copyright owner receives royalties each time a song is broadcast or performed. Fees also accrue if the song is recorded or licensed, say, for an advertisement.
According to The New York Times, under the plan being discussed, Jackson would agree to provide Sony with an option to buy about 25 per cent of the catalog, or half of his stake, at a set price.
The paper said Jackson had used his stake in the catalogue as collateral for about 270 million dollars in loans that were sold last year to a New York-based investment company. The paper said the entire catalogue is valued at about 1 billion dollar.
It said Sony had an interest in keeping Jackson solvent because if he is forced into bankruptcy, the stake in the publishing company could go up for auction, opening it up to another company to bid for it.
A Sony spokeswoman said she could not say when or if there would be any announcement. Jackson's representatives did not immediately return calls for comment.
REUTERS DKS PM2154