Sony Corp. has received U.S. and Japanese government approval for its $2-billion purchase of CBS Records Group, clearing the way for the Japanese electronics giant to become the world's largest record company next month.
Sony and CBS Inc. announced Nov. 18 that they had reached an agreement on the deal, subject to approval by the U.S. Federal Trade Commission and Japan's Ministry of Finance.
Sony said Wednesday that both agencies approved the sale this week and the deal would close Jan. 5.
The FTC had been expected to approve the sale since it appeared to pose no anti-competitive threat to the U.S. record market; that is, the number of major companies would not be reduced by the sale. In 1984, the FTC blocked a proposed merger of the record operations of Warner Communications and Polygram Records Inc. on the grounds that the combination of the second- and fifth-largest U.S. record distributors would create a firm that could unfairly dominate the market.
CBS and Sony have had a 20-year relationship through their joint venture CBS-Sony Inc., which is Japan's largest record company.
Sony said Wednesday that about a third of the $2-billion purchase price will come from Sony's own resources and that the remainder will be financed through Japanese and foreign financial institutions.