Michael Jackson PASADENA, CA – JANUARY 31: Michael Jackson performs during the Halftime show as the Dallas Cowboys take on the Buffalo Bills in Super Bowl XXVII at Rose Bowl on January 31, 1993 in Pasadena, California. The Cowboys won 52-17. (Photo by George Rose/Getty Images)

A $47.5 million investment by Michael Jackson in 1985 has turned into a major money boon more than 20 years later. Believe it or not, the most successful music publishing company in the world just happened to be co-owned by one of the most popular music artists of all-time and it has recently been sold for $750 million.

Behind every artist is a hit song and behind every hit song is a songwriter or composer who created the masterpiece. Music publishing companies were created to ensure that the magicians who created the magic behind the scenes receive their fair share whenever their song is commercialized through a TV show, advertisement, radio show, movie or other forms of media. Sony/ATV owns the catalogue to some of the biggest songs of all time and now Michael Jackson’s estate, of which his kids are heirs, has finally cashed in on the genius investment.

Billboard tells us how the King of Pop developed music publishing business into his side hustle:

Jackson was famously tipped off to the value of music publishing by Paul McCartney — who never forgave Jackson when, with the assistance of longtime attorney John Branca, he purchased ATV: a 4,000-song catalog that controlled the rights to the Lennon-McCartney catalog, as well as songs by Bruce Springsteen, Cher, Elvis Presley, Hank Williams, Little Richard and The Rolling Stones. The loss of that friendship may be the one downside of the deal for Jackson, for which the singer put up just $11 million in cash, according to a source, and used debt to finance the rest of the deal.

Jackson’s first big payoff from the purchase came in 1995, when he joined forces with Sony to form Sony/ATV, acquiring 50 percent of the merged entity and a $110 million payout: A decade after he bought ATV, Jackson already had doubled his initial investment.

As the years progressed, Jackson’s representatives and Sony agreed that one party could buyout the other party’s stake if they chose to do so. Jackson was under a lot of financial distress at the time in 2006 with over $270 million in debt and Sony’s ability to buy his share was as a last resort to make up his monetary hole if he needed it. Despite Jackson’s death in 2009, the company continued to accrue value and even bought another publishing company which contained the rights to even more hit songs – EMI Publishing.

Industry sources tell Billboard that the Jackson Estate will use this money to invest in areas outside of music as well as keep some of the cash in the bank. The estate will also continue to own a stake in EMI Publishing, which as mentioned above is a subsidiary of Sony/ATV. The stake in EMI could make Jackson’s estate even more money in the future:

Whatever the final valuation for Sony/ATV, Jackson’s investment in the 1985 acquisition of ATV will have paid the Jackson estate $1.31 billion when the deal is done — and it will continue to generate returns for the Jackson estate. The estate still owns its 10 percent stake in EMI Music Publishing — which means if the EMI investment is ever unwound, the Jackson estate should, at the least, be looking at another $220 million windfall, and quite possibly more than that.

If that happens, Jackson’s investment in ATV could end up yielding his estate at least $1.53 billion — and it all began with an $11 million cash investment. “You have to say hats off to Branca,” says an industry source. “He was with Jackson when they bought the ATV catalog — and look at how they parlayed that over the years.”

Even Bobby Bonilla is jealous.

[Billboard]

About Jessie Karangu

I am a Kenyan-American broadcast journalist.
An avid tweeter (follow me @JMKTV).
I hope to make a difference in the world.
I was the commencement speaker at my college graduation, Scott Van Pelt was the other speaker (https://www.youtube.com/watch?v=vFUk5PPFkT0)
I won an award for outstanding achievement in sports from the Emmy organization.
My dream is to be the black Ryan Seacrest.