ATV finalizes its acquisition of Northern Songs

The music publishing company Northern Songs was established in February 1963 by music publisher Dick James and his partner Charles Silver, with the primary purpose of publishing songs written by John Lennon and Paul McCartney.

In March 1969, concerned about the growing influence of Allen Klein in the Beatles’ business affairs — and wary of the American businessman’s reputation — James and Silver decided to sell their shares in Northern Songs to Associated Television (ATV) for £1,525,000. They did so without notifying John or Paul or offering them the opportunity to purchase their shares.

The news broke on March 28, 1969, when newspapers reported not only the sale but also ATV’s £9.5 million bid to acquire the remaining shares in the company. This triggered a bitter fight for control of Northern Songs during April and May, with ATV holding 35% of the shares and The Beatles holding 29.7%. On May 19, 1969, it was announced that ATV had partnered with the Consortium — an alliance of broker firms controlling 14% of the company — in a move to secure majority control.

Negotiations continued through the summer and into the autumn of 1969, as both ATV and The Beatles sought to gain a majority stake (over 50%) in the company.

During this period, Allen Klein approached members of the Consortium with offers to purchase their shares once their agreement with ATV expired in May 1970, but these discussions ultimately led nowhere.

Beatles seek Northern audit

THE BEATLES have appointed the accounting firm of Arthur Anderson to carry out an audit of Northern Songs, their publishing outfit, which was recently the subject of a take-over battle with ATV.

But although the audit is now taking place the Northern Songs board, on which the Beatles are not as yet represented, has objected to the scope as initially envisaged.

ATV’s finance director Jack Gill told RR that there was no opposition to a standard record industry audit into collection and payment of royalties. However, a full audit had been refused as being against commercial practice.

“If the representatives of the Beatles wish to sit down and talk about the interests of all share-holders in this public company, then of course there is no objection. But we can’t allow one share-holder, no matter how important, to have information not available to all other share-holders, of which there are many thousands,” he said.

“We are not asking for the audit as share-holders, but only as composers,” commented Allen Klein, the Beatles’ business manager.

ATV last week increased its stake in NS from 35 per cent to around 38 per cent. With the Beatles now owning a maximum of 35.5 per cent, the stock brokers consortium which holds the balance of power with a 14 per cent share is believed to have had approaches from A. J. Butler, an American broker.

Although acting independently Butler is regarded as being friendly towards the group, and if he succeeds in purchasing the shares then they are likely to be under a put and call offer for 18 months. Under such an arrangement, it is understood, there would be no need for Butler to make an offer for the whole company.

From Record Retailer – September 20, 1969

ATV win the battle for Beatles firm

SONGWRITING Beatles John Lennon and Paul McCartney have finally lost their fight to control the Northern Songs music company. It was announced last night. The announcement came from Associated Television, Ltd., which made a 29s.-a-share takeover offer for the company five months ago. The Beatles made a counter-offer at the same time. Some shareholders accepted the ATV offer.

Those who did not included Beatles Lennon and McCartney — with about one-third of the total shares between them — and Ringo Starr, a small shareholder. The fourth Beatle, George Harrison, had already sold his minority holding.

After the clash, both sides set about buying up Northern Songs shares. But Associated Television took effective control of the firm by teaming up with a City investment group which held 15 per cent. of the shares. Now, ATV have bought that 15 per cent. block at £2 a share. That gave ATV a controlling 53 per cent. of Northern Songs, which owns the copyright in most Beatles songs.

The Beatles’ business adviser, American lawyer Allen Klein, 35, refused to comment last night on ATV’s victory announcement.

From Daily Mirror – September 20, 1969

Battle Renews Re : Northern Control

LONDON – Another battle for control of Northern Songs seems imminent. Associated Television won a narrow victory over The Beatles earlier this year with the aid of a consortium of brokers, whose 14% holding caused a virtual stalemate in May. Now it appears The Beatles have made approaches to the consortium through American stockbroker A. J. Butler, who is expected to make an improved and formal offer for the consortium’s Northern slice. Bank of England and Takeover Panel permission would be necessary before any deal could go through, however, The consortium’s agreement with ATV gives that company first refusal of the consortium’s shares and support on the board until May next year. but does not preclude the stockbrokers negotiating future contracts with interested parties now.

Meanwhile, Beatles business manager Allen Klein is believed to have agreed to a new royalty deal for the group with the EMI organisation. It will cover the remainder of the present nine-year contract expiring in 1975, and is understood to give The Beatles an appreciable increase in American disk royalties through Capitol in return for a guaranteed amount of product.

From CashBox Magazine – September 27, 1969

Allen Klein then turned his attention to ATV.

[Klein] came to see Sir Lew [Grade, chairman of ATV] with vague terms under which he would see to it that we got control of Northern by delivering the Beatles’ shares to us. At that time he was there to knock the Consortium. The main concession was that Apple would get sub-publishing rights for the Beatles’ songs throughout the United States and Canada.

We were willing to consider it but told Klein that we were not in a position to do so at that time, because of our agreement with the Consortium.

Jack Gill  – From “Apple to the Core: The Unmaking of the Beatles” by Peter McCabe and Robert D. Schonfeld (1972)

ATV, meanwhile, remained dissatisfied with the status quo and was determined to secure a majority stake in Northern Songs, rather than continue relying on its agreement with the Consortium. However, the company found itself in a difficult position: its share price was at a low point during the summer of 1969, and any formal offer to purchase shares from the Consortium would have required extending the same terms to all shareholders — including The Beatles — a scenario ATV wanted to avoid.

In early September, the Consortium began to fall apart, with some members opting to sell their shares. Under the terms of the agreement signed in May, the remaining parties had rights of pre-emption, allowing them the first opportunity to buy any shares offered for sale. ATV seized this opportunity and quietly increased its stake in Northern Songs.

We thought we’d get their shares in the end. It was very difficult to deal with a Consortium of that nature – with so many different interests. Anyway, what right has a broker to pledge his client’s shares? If the client decided to sell that was that. The agreement meant nothing.

Jack Gill – ATV financial director – From “Apple to the Core: The Unmaking of the Beatles” by Peter McCabe and Robert D. Schonfeld (1972)

On September 8, 1969, ATV announced it had increased its stake in Northern Songs, from 35% to 38%.

Peter Donald, chairman of Howard and Wyndham and one of the largest members in the Consortium, entered into negotiations with Sir Lew Grade and Jack Gill of ATV. As a result, on September 19, ATV acquired additional shares from the Consortium, bringing its ownership to just under 50%. Less than a week later, on September 25, ATV further increased its holding to 54%, thereby securing effective control of Northern Songs.

One morning I called Peter Donald, who by that time had acquired control of the Howard and Wyndham Theatres, as well as some theatres in Scotland. Peter Donald’s company controlled 14 per cent of the Northern Songs shares. I had a strange feeling about Alan Klein because of all these unnecessary delays, so, when I called Peter Donald, I said, ‘I want to buy your 14 per cent of Northern Songs. How much do you want for it?’ We agreed a price and did the deal on the telephone. We now had well over 54 per cent of the company and therefore controlled Northern Songs. Alan Klein called me late that afternoon, and I must give him credit for what he said to me. ‘Well,’ he said, ‘I have to admit it. You beat me to the punch. We’re now ready to sell you the shares at the same price you paid Peter Donald.’ He said he’d been considering doing the deal with Donald himself, but had obviously left it too late.

And that, my friends, is how we acquired the Beatles catalogue and got into the music business.

Sir Lew Grade, head of ATV (Associated Television) – From “Still Dancing : my story” by Lew Grade

Songs: ATV new bid

Sir Lew Grade’s Associated Television Corporation yesterday made its eagerly awaited bid for the rest of Northern Songs. A.T.V. announced that, as it has not been possible to conclude negotiations concerning the Beatles’ interests in Northern Songs, the directors have decided to make a general offer for all outstanding shares.

The terms are 40s. nominal of new five-year unsecured loan stock.

A.T.V.’s bid comes three weeks after the company won control of Northern Songs by buying out the 10 per cent plus share stake from a City consortium.

A spokesman for the City takeover panel, which has been urging A.T.V. to make a full bid, said last night the panel regards the latest move as “satisfactory”.

Negotiations between Allen Klein, the Beatles’ representative, and A.T.V. were continuing last night.

From The Times – October 11, 1969

ATV Nears Control Of Northern

LONDON – Associated Television seems to be very close to total victory in the prolonged struggle for control of Northern songs. The key 13% holding in Northern stock controlled by the Astaire – W. I. Carr consortium of brokers has been bought by ATV at 40 shillings per share, thus effectively ending the hopes of the Beatles of capturing their publishing company. It is understood that the broker consortium accepted the ATV offer because they believed that if the Beatles had retaliated with an even higher offer and ATV had agreed to sell its holding at that price, the Beatle faction would have been unable to raise sufficient cash to implement their offer. Meanwhile, John Lennon and Paul McCartney issued a writ through Maclen Music on September 16th requiring an account of money possessed or received by Northern under an agreement dated February 11th, 1965 and seeking an order that Northern should pay Maclen half of any money which, following an audit, is shown to have been possessed by the defendant, together with interest at an annual rate of 6%. Under the 1965 agreement of all broadcast and performance fees are paid by Northern to Maclen. Northern intends to contest the writ.

From CashBox Magazine – October 11, 1969

Allen Klein went back to ATV and Sir Lew Grade, for another round of negotiations and an agreement was found but fell through due to obstruction by John and Lee Eastman:

The broad lines of the ATV-Beatle agreement negotiated by Klein were that: (1) ATV would buy all their Northern shares in exchange for loan stock and cash; (2) The Beatles would withdraw the outstanding writs lodged against Northern Songs by Maclen (Music); (3) John and Paul would re-sign as songwriters until 1976 – and George and Ringo would switch from Apple Publishing to Northern, also until 1976; (4) Lenmac would be sold back to John Lennon and Paul McCartney, and (5) Apple would get sub-publishing rights in the United States.

From “Apple to the Core: The Unmaking of the Beatles” by Peter McCabe and Robert D. Schonfeld (1972)

We all finally agreed. It was a very good deal for both sides. Heads of the agreement were drawn up with our respective lawyers. Then, Allen Klein couldn’t get the Eastmans and Paul to agree and so it fell through.

John and Lee Eastman had stopped the deal. They wouldn’t let Paul be a party to an agreement negotiated by Klein on behalf of all the Beatles. There was no way the two Beatle factions could agree.

Klein was very sorry and I was very sorry because part of the deal was that we’d have got Harrison and Ringo, who at the time really didn’t mean much. Of course, George Harrison has since been a great success as a songwriter.

Jack Gill – From “Apple to the Core: The Unmaking of the Beatles” by Peter McCabe and Robert D. Schonfeld (1972)

I can’t understand it to this day. [The Eastmans and McCartney] were mad not to take ATV shares considering what they’d have been getting.

Sir Lew Grade, head of ATV (Associated Television) – From “Apple to the Core: The Unmaking of the Beatles” by Peter McCabe and Robert D. Schonfeld (1972)

Following this missed opportunity, The Beatles ultimately announced their intention to sell their shares in Northern Songs to ATV. However, ATV was initially reluctant to proceed, as it remained in their interest to retain The Beatles as shareholders in order to keep them creatively engaged and motivated.

The situation changed when the City Takeover Panel — the regulatory body responsible for ensuring equal treatment of shareholders during takeover bids — intervened. The Panel required ATV to extend to The Beatles and other minority shareholders the same offer that had been made to the Consortium weeks earlier.

Although Jack Gill was initially prepared to resist the Panel’s pressure, the ATV board ultimately agreed to purchase The Beatles’ shares. The decision was publicly announced on October 22, 1969.

ATV continued to acquire shares from remaining minority stakeholders. By mid-December 1969, it was announced that the company had secured 96% ownership of Northern Songs. In January 1970, this figure rose to 99%, with the final 1% held by small shareholders — many of them Beatles fans — who were difficult to trace.

The news, when it reached Apple – by a tip-off from the Financial Times – sounded very like defeat. Allen Klein, interviewed during his customary afternoon breakfast, claimed it as a victory. A threatened lawsuit against Northern for £5m in ‘unpaid’ Beatle royalties helped to persuade ATV to pay cash rather than stock for the Beatles’ holdings. Klein could thus congratulate himself on having enriched John and Paul by about a million and a half pounds each, and Ringo by £80,000.

From “Shout!: The True Story of the Beatles” by Philip Norman

Press Office Release to UPI, AP, Reuters, PA: On behalf of The Beatles and their company, Apple Corps, their business manager Allen Klein of ABKCO Industries after discussion with The Beatles announced in New York today that all negotiations between The Beatles, Associated Television, and Northern Songs have been terminated by The Beatles. All of The Beatles and their companies intend to sell all their shares in Northern Songs to Associated Television at a price in accordance with the terms laid down by the takeover panel. John Lennon and Paul McCartney have no intention of involving themselves in any further relationship with Northern Songs or Associated Television beyond the fulfillment of their songwriting contract to February 1973. The Beatles intend to keep all their rights within their own company, Apple, which has divisions in records, music publishing, motion pictures, and television. After discussions with The Beatles’ solicitors and after taking advice of counsel, the writ served upon Northern Songs by The Beatles’ own Maclen Company will not be withdrawn and a statement of claim will be served within the next few days.

From “The Longest Cocktail Party: An Insider Account of The Beatles & the Wild Rise and Fall of Their Multi-Million Dollar Apple Empire” by Richard DiLello

VICTORY FOR ATV IN FIGHT OVER BEATLE FIRM

The battle for control of Northern Songs, the group which publishes the Beatles’ hits, has been won by Associated Television. But it hasn’t won the Beatles.

A statement issued in New York last night by their business manager, Mr. Allen Klein, said that the Beatles and their companies intended to sell all their shares in Northern Songs — totalling about 35 per cent. of the company — to ATV for £2 a share.

But he added: “John Lennon and Paul McCartney have no intention of involving themselves in any further relationship with Northern Songs or ATV, beyond the fulfilment of their songwriting contract to February 1973.”

Mr. Klein also said that all negotiations between the Beatles, ATV and Northern Songs had been terminated by the Beatles. He went on: “The Beatles intend to keep all their rights within their own company, Apple, which has divisions in records, music publishing, motion pictures and television. After discussions with the Beatles’ solicitors and after taking advice of counsel, the writs served upon Northern Songs by the Beatles’ own Maclen Company will not be withdrawn and a statement of claim will be served within the next few days.”

The writs concern extra payments which the Beatles claim as royalties on past performances of their songs. ATV chief Sir Lew Grade said last night: “We have already announced our offer — we’re delighted this has now been accepted. We are now expecting some brilliant music from the Beatles.”

From Daily Mirror – October 16, 1969

Beatles Selling Northern Holdings To Associated TV

NEW YORK — Bringing the Beatles – Associated Television Co. stock battle to an end, the Beatles are selling their shares of Northern Songs to ATV, which already controls the company. Stock sale is said to amount to $4.8 million.

An announcement from Apple Corp., on behalf of the Beatles and their companies, after discussions with their business manager, ABKCO Industries, and its president Allen Klein, indicated that Lennon and McCartney have “no intention of involving themselves in any further relationship with Northern Songs or Associated TeleviSion beyond the fulfillment of their songwriting contract to Feb., 1973”. Further, the statement said, the Beatles intend to keep all their rights within their own company, Apple, which has divisions in records, music publishing, films and television.

“After discussions with the Beatles solicitors,” the statement concluded, and after taking advice of counsel the writ served upon Northern Songs by the Beatles own Maclen co. will not be withdrawn and a statement of claim will be served within the next few days.” This refers to a writ issued by Lennon & McCartney through Maclen Music on Sept. 16 requiring an account of money possessed or received by Northern under an agreement dated Feb. 11, 1965 and seeking an order that Northern should pay Maclen half of any money which, following an audit, is shown to have been possessed by the defendant, together with interest at an annual rate of 6%

From CashBox Magazine – October 25, 1969

Beatles will not renew Northern deal

JOHN LENNON and Paul McCartney will not renew their songwriting contract with Northern Songs when their present contract expires in 1973. Instead they will channel all their copywrites through Apple.

ATV will secure 100 per cent control of Northern Songs this week if its final offer for the 45 per cent outstanding is accepted. Lennon and McCartney own 35 per cent and members of the public control 10 per cent according to ATV financial director, Jack Gill, who spoke to RR on Friday.

ATV will merge Northern into the ATV music division which also embraces Pye records and its fully owned music publishing company Welbeck.

Dick James, who has managed Northern Songs since its conception has a contract to run the firm until 1973.

In a statement issued by Allen Klein, the Beatles business manager, last week, he said that talks had been terminated between Northern and ATV and that Lennon and McCartney had agreed to part with their shares. A writ served by Maclen against Northern still stands and a further statement will be issued later this week.

From Record Retailer – October 25, 1969

Beatles accept ATV offer

BEATLES HAVE accepted ATV’s offer for the outstanding shares in Northern Songs now giving the company a 97 per cent share in Northern. The offer is unconditional and will remain open until December 16.

The Beatles and their company Subafilms turned in 1,663,000 of the 2,078,216 shares which the offer attracted and of ATV’s new loan stock, for which dealings started today (Wednesday), Paul McCartney and John Lennon will receive £1,503,000 and £1,298,000 respectively.

Ringo Starr will get £80,000 worth of stock for his holdings in Northern while Subafilms, the group’s film division, will stand to make £534,000.

A spokesman for the group is reported as saying this week that it would be difficult to comment on whether the loan stock would immediately be realised as it seems likely the Beatles will hang on to it for awhile – thus deferring a fat capital gains liability.

From Record Retailer – December 12, 1969

YOUR MONEY by ROBERT HEAD

A HANDFUL of Beatles fans are holding up final completion of an important City takeover.

This extraordinary situation was spelt out for me yesterday by Mr. Jack Gill, finance director of ATV, which last year made a bid for Northern Songs, the company which owns copyrights on most Beatles hits.

John Lennon and Paul McCartney, big shareholders in Northern Songs, agreed to accept the bid back in October, and holders of 99 per cent of Northern Songs shares have accepted too.

The whole deal should have been tied up by now. But meetings have had to be postponed. What is blocking the deal is that the odd one per cent of the shares is spread around 500 or so Beatles fans who bought themselves a few when their idols were launched on the Stock Exchange.

They may not hold many shares. But counting heads rather than shares, these fans add up to more than 25 per cent of the total number of individual shareholders. So until more of them can be rounded up and persuaded to accept the bid, ATV cannot, under the Companies Act, secure the necessary 75 per cent majority of shareholders needed to complete the deal.

Mr. Gill, who is now chairman of Northern Songs, told me: “There is a large number of Beatles fans spread throughout the world whom we just cannot trace, though we are still trying.“

In the company secretary’s office at Northern Songs, I was told: “It is more like a missing persons bureau here. We are still sending reminders about the offer to girls in America, Scandinavia and Germany, but they come back marked ‘Not known’. In this permissive society I suppose people move around quicker.“

Only about fifty of the missing Beatles fan live in Britain.

From Daily Mirror, January 28, 1970

Battle for Northern halted

THE LONG battle for 100 per cent control of Northern Songs by ATV came to an abrupt halt last Wednesday when shareholders stayed away from the annual general meeting. I was the only outsider to attend at the given time, writes Philip Palmer, and as no shareholders were present the meeting was adjourned by Northern chairman Jack Gill.

It is understood that there are now only 507 shareholders controlling 32,408 shares and under Section 209 (1 and 2) of the Companies Act of 1948, ATV will send out, after March 7, the earliest date, notices to the remaining shareholders of its intentions. In accordance with the ATV offer, the Northern Songs board does not intend to recommend the payment of any final dividend.

From Record Retailer – March 7, 1970

Going further

The Beatles Diary Volume 1: The Beatles Years

With greatly expanded text, this is the most revealing and frank personal 30-year chronicle of the group ever written. Insider Barry Miles covers the Beatles story from childhood to the break-up of the group.

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