Pop diva Mariah Carey has signed a four-album contract with Virgin Records worth an estimated $80 million, a mega-deal that ranks among the biggest ever awarded to an entertainer, said sources close to the negotiations.
The New York native, who turned 31 last week, has been the target of a fierce industry bidding war since she began approaching the end of her Sony contract, which was set to expire with the release of a soundtrack album this year. Speculation about her exit had mounted since her marriage to Sony Music chief Thomas Mottola broke up in 1997.
But executives at several other record labels dropped out of the bidding because they believed that their companies could not make enough money under the terms sought by Carey.
The pact, which could be announced as early as today, comes at a crucial juncture for Virgin's parent, British music conglomerate EMI Group, which is lagging behind its four industry competitors in the U.S. music market and has been the subject of takeover rumors for years.
EMI was set to merge with AOL Time Warner's Warner Music Group before European antitrust regulators' objections pressured the two companies to nix the deal in October, and it is negotiating to join with German media giant Bertelsmann. Adding Carey to the roster provides luster to the company in the event the negotiations fail and EMI winds up on the auction block.
Representatives for Carey and Virgin declined to comment on the deal, which was negotiated by EMI music Chief Executive Ken Berry, Virgin Records Chairwoman Nancy Berry and the singer's attorney, Donald Passman.
But sources said the deal paid Carey a $20-million advance upon signing and guaranteed an estimated $20-million advance per album plus a 25% royalty on the retail price of each record sold. Virgin will deduct money from her royalties until most of the cash advances are paid off.
Besides giving Carey complete artistic control over her work, the new deal covers four albums of new material and provides an estimated $7-million non-recoupable payment to reimburse her for the cost of buying out the last album on her Sony contract. Sources said Sony retains distribution of that album in Japan, one of the areas where she is most popular. According to Sony's Columbia Records, Carey has sold an estimated 120 million records worldwide.