STEVEN TYLER CAPITALIZES ON TAX LAW AND DEALS CATALOG:
January 10, 2008
In a deal that capitalizes on a recent change in tax law, Aerosmith front man Steven Tyler has formed a strategic partnership that includes the sale of an interest in his band’s publishing catalog to Primary Wave Music Publishing, The Post has learned.
Terms of the deal, expected to be announced today, were not disclosed, but music industry sources estimate the pact – which covers 160 songs written or co-written by Tyler – is worth about $50 million.
Included in the deal are the rights to many of the hit songs that led to Aerosmith’s reemergence on the rock scene beginning in the late 1980s, including “Love in an Elevator,” “Dude Looks Like a Lady,” “Janie’s Got a Gun,” and “Jaded.”
Tyler doesn’t own the rights to Aerosmith’s 1970s-era hits like “Dream On,” “Sweet Emotion,” and “Walk This Way,” which have led critics to refer to Aerosmith as the American version of The Rolling Stones.
Founded by former Arista and Virgin Records head Larry Mestel, Primary Wave has grown into one of the 10 largest music publishing companies in the US thanks to an acquisition pace that is averaging more than one deal per month.
The Tyler partnership marks the company’s 19th purchase since it was founded just 18 months ago.
Primary Wave also holds an equity stake in the rights to The Beatles’ songs written by John Lennon and the publishing catalogs of Kurt Cobain, Daryl Hall and John Oates, Steve Earle and others.
The deal with Tyler, however, may have more to do with a recent tax law change than anything else.
Prior to 1996, a songwriter of Tyler’s stature would have been subject to an ordinary in come tax rate of 38 percent if he sold his copyrights. However, two years ago, the government changed the tax code so that Tyler and others are subject to a capital gains tax of about 15 percent.
In an interview with The Post, Mestel said that he saw “enormous opportunities to market Steven’s music.”
According to Tyler’s attorney, John Branca, the large-lipped singer has been impressed with how Mestel has promoted the other works under his aegis.
“Steven’s a creative guy, and seeing what Larry has done with Cobain’s catalog was very persuasive for him,” Branca said.
Mestel has managed to find commercial uses for Cobain’s music that avoided outraging Nirvana purists, including having the plot line of an episode of the CBS show “Cold Case” told through eight Nirvana songs.
“I love the passion and commitment that Larry and his team put into marketing songs,” said Tyler. “Primary Wave’s expertise will ensure that my catalog will continue to rock generations well into the future and boldly go where no songs have gone before.”
Courtesy of www.nypost.com