https://www.nytimes.com/2018/07/27/business/media/fania-records-salsa-music.html?rref=collection%2Fsectioncollection%2Fnyregion
Catalog of Fania Records, the Motown of Latin Music, Is Sold
July 27, 2018
By Ben Sisario
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The Pete Rodriguez classic “I Like It Like That” is a centerpiece of the deal.Fania
All summer, Cardi B’s hit “I Like It” — which went to No. 1 the week of July 4 — has been introducing a generation of listeners to a Latin classic more than 50 years old: Pete Rodriguez’s “I Like It Like That” from 1967, which Cardi B liberally samples and reinterprets.
Now “I Like It Like That,” a standard of the pre-salsa style known as boogaloo, is a centerpiece of one of the largest Latin-focused music deals in years.
This week, the catalog of Fania Records, the New York salsa label that defined the genre in the 1960s and ’70s with stars like Celia Cruz, Willie Colón, Héctor Lavoe and Johnny Pacheco, was purchased by Concord Music, an independent label and publisher that has become a mini-conglomerate by pursuing rock, jazz, children’s music and other genres that rarely graze the Top 10 but have vast, devoted audiences.
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Cardi B’s hit “I Like It” liberally samples and reinterprets the Rodriguez song.Amy Harris/Invision, via Associated Press
The deal, which includes Fania’s recorded music collection of about 3,000 albums, as well as the music publishing catalog of songwriting rights for about 8,000 songs, is estimated at $30 million. (Fania controls the recording of “I Like It Like That,” but not its songwriting.)
“This is consistent with our strategy of not focusing on current pop hits,” Scott Pascucci, Concord’s chief executive, said in an interview. “We are very happy when we have songs that cross over to the pop chart, but we focus on genres where we find that the majors are not particularly focused.”
Fania, sometimes called the Motown of Latin music, was started in 1964 by Mr. Pacheco and Jerry Masucci, a lawyer. In the early days, Mr. Pacheco, who is now 83, sold records out of the trunk of his Mercedes 180. But before long, Fania became a powerhouse and the primary label for the evolving sound of salsa, a distinctively New York mix of Cuban and Puerto Rican dance styles, sometimes mingled with funk.
Celia Cruz and Johnny Pacheco were among the stars of Fania Records’ stable of artists.Fania
A 1973 concert at Yankee Stadium, featuring a collection of stars from the label and released as a live album two years later, crystallized the label’s prestige. But by the 1980s, Fania was dormant. A slow recovery began to take shape in 2009 when the label’s assets were bought by a private equity fund, Signal Equity Partners, which set up an operating company, Codigo, and went about trying to get Fania’s music available on digital services, and promoting it to producers and D.J.s.
“We’ve really done most of what we set out to do,” Timothy P. Bradley, Signal’s managing director, said when asked why Signal had decided to sell.
Latin music is particularly popular on streaming services, which has helped recent Spanish-language songs like “Despacito” become global hits. According to Nielsen, 82 percent of all consumption of Latin music is through streaming services — more than any other genre, including hip-hop and dance music, which are both at 79 percent.
The cover art of Ray Barretto’s “Acid” for Fania.Fania
For many owners of music catalogs, the success of streaming has lifted valuations and lured new investors, creating a frothy market for deals. Among other transactions this year, Bob Marley’s publishing rights traded for $50 million.
For Concord, Fania is the latest in a string of recent deals. Last year it paid more than $500 million for the Imagem Music Group, which included the music publishing catalogs of Rodgers and Hammerstein and hits by Phil Collins, Mark Ronson and Daft Punk.
Over the last year, Concord has spent $150 million acquiring more catalogs, and by next year the company expects to have $400 million in revenue, Mr. Pascucci said. That puts the company well below the level of corporate giants like Universal Music — which had nearly $7 billion in revenue last year — but above most indies.
Steve Salm, Concord’s chief business development officer, said the company’s size sometimes gives it an advantage in deals. (Mr. Bradley confirmed that Concord’s bid was not the highest, but gave no further details about the sale.)
“To the artists, songwriters and rights holders looking to find a home for their legacies,” he said, “we aren’t the big guy and we aren’t the little guy.”
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