Warner Music Group said today it plans to sell 32.6 million shares to the public at an estimated price of $22 to $24 per share to raise as much as $782 million.
Warner Music, the world's fourth largest record company, also disclosed in documents submitted to regulators that it is in talks with Time Warner to buy back warrants that enable the media conglomerate to take a 15 per cent stake at a discount price.
By exercising the three-year warrants, Time Warner could pay $284.4 million based on an IPO of $23 a share, the music company said.
If Time Warner pays cash, it would own about 19 million shares of common stock and if it does not use cash, 6.6 million. A group of investors led by media mogul Edgar Bronfman Jr. bought the smallest of the four major record companies from Time Warner last year for $2.6 billion.
The warrants were issued in connection with the takeover by Bronfman, Thomas H. Lee Partners, Bain Capital and Providence Equity Partners.
According to an amended prospectus filed with the US Securities and Exchange Commission, the underwriters of Warner Music's IPO, led by Goldman Sachs & Co. and Morgan Stanley, will have the option to buy an additional 4.9 million shares to cover over-allotments.
Warner Music said it intends to list its shares on the New York Stock Exchange under the symbol "WMG". Separately today, Warner Music announced it had appointed Mr
Joesph de Raaij to be chief financial officer of its international division.