Seagram: We're No. 1, We're No. 1!

05/22/1998 3:00 AM, Yahoo! Music
Bruce Haring

(5/22/98) - In the biggest deal in music industry history, Canada's Seagram Company Ltd. has acquired PolyGram Entertainment and its associated record labels in a deal valued at $10.6 billion.

PolyGram, whose stars include Sheryl Crow, U2, Elton John, Hanson and Bob Marley, will now see its various record labels--A&M, Decca/ London, Def Jam, Deutsche Grammophon, Island, London, Mercury, Motown, Philips Music Group, Polydor and Verve--become part of the Universal Music Group, home to MCA, Geffen and GRP Records as well as Erykah Badu, Jimi Hendrix, B.B. King and Semisonic.

Universal is now "the greatest music company in the world," according to Edgar Bronfman, Jr., president/ CEO of Seagram. The combined Universal/ PolyGram empire is expected to out-distance its nearest rivals, Sony Music and Time Warner, by over a billion dollars a year.

What's good news for Seagram isn't necessarily good news for PolyGram employees and artists. Bronfman estimated that combining the two companies would save an estimated $275 million to $300 million annually. The unstated way to achieve that will be a trim of the payroll.