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Fantasy Records Up For Sale

By Matthew Artz
Tuesday March 02, 2004

Berkeley-based Fantasy Records, which owns many of the greatest recordings from the Golden Age of jazz, is for sale, according to a report in Billboard magazine. 

Fantasy executives refused to comment on the story published Friday, but one source confirmed the label was on the market. 

Billboard quoted an anonymous source that said the label, which generated sales of about $30 million in 2002, is being offered at $100 million, though a sale price will likely range from $64 million to $85 million, depending on yet unreleased 2003 earnings data. 

Fantasy—the largest record label in Northern California, with about 80 employees—owns legendary recordings by Miles Davis, John Coltrane and Thelonious Monk. It is also home to Creedence Clearwater Revival, a famous rock group. The company is the product of decades of record label acquisitions that allowed it to amass one of the largest troves of jazz and rhythm and blues music in world. Much of the company’s profits come from the repackaging of its catalog and selling songs for commercials or compilation albums, though the label does maintain an active roster of performers, including Sonny Rollins, Jimmy Scott and Berkeley High graduate Dave Ellis. 

Typically when a record label is sold, the buyer keeps the operation in place to preserve relations with its musicians, said David Card, media analyst for Jupiter Research. But Fantasy’s emphasis on its catalog business has some wondering if a sale would mean the label would leave Berkeley. 

Fantasy spokesperson Terri Hinte said, “It was way too premature” to talk about what would happen to employees if a sale went through. 

Possible suitors include the label’s distributor, Beverly, Mass.-based Rykodisc, Beverly Hills-based Concord Records and New York-based Redux Records, Billboard reported. None of those companies returned phone calls Monday. 

Fantasy is a private company, and sorting through its financial data could be messy. Billboard speculated that this could result in a long due diligence period and a soft sales price. 

Fantasy also owns music studios located at its Berkeley headquarters. The company is headed by Saul Zaentz who has produced several movies, including The English Patient. 

A few years ago Fantasy backed out of a deal to sell its record business, said former Oakland Tribune Music Critic and Down Home Music Store employee Larry Kelp. He guessed that declining CD sales and the rapidly changing music business was driving their renewed interest in a sale. 

“Their money is in CDs and CDs might not even exist soon. They might not want to figure out the next step,” said Kelp, adding that Zaentz was no longer actively involved in the record business.  

Despite declining revenues in the record industry, Dave Zaworski, associated editor of Down Beat Magazine said Fantasy would attract heavy interest. “Their stuff will always sell,” he said. “It would be enticing for a lot of labels.” 

Though the record industry has been racing towards consolidation, Zaworski said jazz has experienced an opposite trend. Major labels, including Atlantic and Columbia have dumped their jazz divisions, he said, offering more opportunities for smaller record companies. 

Fantasy was started in 1949 by Max and Sol Weiss. Zaentz bought the company in 1967. After the success of Creedence, he went on a buying spree and purchased top jazz labels, including Milestone, Riverside and Prestige. 

Kelp said that Fantasy maintains a family atmosphere, which makes the prospect of a sale even more unsettling. “There’s probably almost 100 people who have been there most of their lives,” he said. “It’s not a cutthroat company where the management is separate from the people.”  

 

 

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