Universal Music Group Affirms Nigeria as a 'High-Potential' Market

Virgin Music will play a crucial role in integrating these entrepreneurs and labels into UMG’s ecosystem, potentially paving the way for full acquisitions over time.

Universal Music Group (UMG) recently completed the acquisition of the remaining 30% stake in RS Group, following its earlier purchase of a 70% share in the Thai company. According to UMG, the total acquisition, valued between $65-$70 million, is in tandem with its strategy to expand into emerging markets, where streaming monetization will likely rise in the coming years. Among these “high-potential” territories, UMG identifies China, India, Vietnam, Nigeria, Indonesia, Thailand, and others, as ripe for investment and growth.

UMG outlines a “triple-pronged” approach to these markets, focusing on:

• Building local A&R teams,

• Providing support services to local entrepreneurs & labels through its indie arm, Virgin Music Group,

• Engaging in mergers and acquisitions (M&A).

UMG is keen on acquiring small, nimble companies, particularly those led by entrepreneurs who have operated independently thus far. Virgin Music will play a crucial role in integrating these entrepreneurs and labels into UMG’s ecosystem, potentially paving the way for full acquisitions over time.

Earlier this year, UMG finalized the acquisition of Nigeria’s Mavin Records, a deal that is expected to clear all regulatory processes by the past quarter. Dapper, another Nigerian label, is also in bed with UMG through its independent arm, Virgin Music.

UMG highlights the digital-first nature, absence of entrenched legacy systems, more flexible processes, and lower operational costs in these markets as key factors that create worthy profit opportunities. These opportunities are more when the music is exported to regions with higher Average Revenue Per User (ARPU).