Mottola Returning With an Old Label

Thomas D. Mottola, pushed out as Sony Corp.’s music chief in January, is back -- and bringing a famous name with him.

The 52-year-old industry veteran said Monday that he expected to launch a label with backing from Vivendi Universal’s Universal Music Group, to be called Casablanca Records.

A legendary Los Angeles label of the same name helped define the 1970s with such rock acts as KISS and disco stars Donna Summer and the Village People before profligate spending brought it to the brink of bankruptcy. The original Casablanca was eventually acquired by Dutch company Polygram, which later was swallowed by Universal.

Industry sources said the reborn Casablanca would be part of Universal’s Universal/Motown division under a five-year arrangement and would release two or three albums by September.

The deal would put Mottola in business with Universal Music Group Chairman Doug Morris, a longtime friend and competitor. It also would mark a clean break with Sony, where the executive spent 14 years and fostered the careers of Mariah Carey, whom he married and later divorced; Celine Dion; Jennifer Lopez; Marc Anthony; and Bruce Springsteen.

Mottola had discussed launching an enterprise with Sony earlier this year after the Japanese conglomerate told him it wouldn’t renew his lucrative executive contract. But he said in an interview Monday that he decided that “the best thing would be to move on. It’s as simple as that.”

Sony declined to discuss the talks with Mottola.

Sony Music Chairman Andrew Lack, a former television executive who was handed the reins six months ago, said, “Tommy Mottola is a legendary figure in the music industry with an extraordinary track record. I know I speak for everyone at Sony Music when I wish him success.”

Mottola said he had been signing acts for the new label for the last several months, but wouldn’t discuss the evolving roster. He has been known for building the careers of pop divas and for his sure touch with Latin music and recently was executive producer of a VH1 talent search series, “Born to Diva.”

The new Casablanca would surface at a time of wrenching change in the music business, which is suffering from online piracy, radio industry consolidation and surging costs. Album sales have declined about 8% this year after an 11% drop last year.

For Sony, sales declines and a $142-million operating loss through most of last year prompted the company to seek to rein in costs, leading to Mottola’s abrupt departure. The company subsequently engineered a restructuring that resulted in the loss of about 1,000 jobs and the consolidation of some operations of its two main labels, Columbia and Epic.

In making his new start, Mottola said he decided to honor the memory -- if not all the business habits -- of a label remembered for its ability to discover hits.

“If you look back at the past, companies that really helped form this industry, it was all music- and artist-driven. It was not controlled by big corporations,” he said. “That’s what I want this to be all about.”

For Universal, the world’s biggest record conglomerate, Casablanca would mean doing business with an executive who had built its largest global rival.

Universal’s Morris, who ascended to his own post after being fired as the domestic chief of the former Time Warner Inc.’s music operation, said he started pursuing Mottola the day Sony announced his exit.

“There are not many people that have had the kind of success he’s had,” Morris said. “What I’m looking for is someone who can deliver hits, and he fits that bill.”