Warner Music takes majority stake in label run by son of top rival

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Warner Music has acquired a majority stake in record company 10K Projects, the upstart label behind the rapper Ice Spice, for an undisclosed sum, according to a person familiar with the matter. 

10K Projects was founded in 2016 by Elliot Grainge, the son of Universal Music chief Lucian Grainge — Warner Music’s rival. 

Warner, the third-largest music company behind Universal and Sony, views the deal as a way to invest in the next generation of leaders in the music business and on up-and-coming talent. 

In spite of his father’s role atop the music industry, the 29-year-old Elliot Grainge recently criticised major record labels, telling the Los Angeles Times that they are “a conveyor belt” whose power has been “completely decimated” in the past few years. “Essentially they’re a bank,” he said.

10K Projects will exist as its own label within Warner Music’s portfolio, which includes Atlantic Records, Elektra and others. Elliot Grainge will continue as chief executive of 10K.

Grainge on Tuesday said the deal “provides us with the backing, the collective expertise and vision to empower our artists and our employees on the next phase of our journey”.

Warner did not disclose the terms of the transaction, describing it on Tuesday as a “joint venture” with 10K Projects. “Together, we’ll grow our investment in artistry and accelerate the pace of our innovation,” said Robert Kyncl, Warner Music chief executive.

The deal comes as Warner and the other major labels, who combined control two-thirds of the music market, have been buying up independent record companies.

Warner in 2021 agreed to buy hip-hop label 300 Entertainment for more than $400mn, as well as Russian indie label Zhara Music. Sony Music in 2021 paid $430mn to buy independent music company AWAL.

Warner Music, home to Dua Lipa, Lizzo and Ed Sheeran, is controlled by Access Industries, the holding company for Ukrainian-born billionaire Leonard Blavatnik, through supervoting shares.

Shares in Warner Music have fallen about 5 per cent this year. Warner reported it made net profit of $124mn in the second quarter, as revenue rose 9 per cent from a year ago to $1.6bn. “We continue to invest in new creative talent,” Kyncl told investors last month.