Thursday, December 22, 2005

Jackson negotiating to avoid defaulting on loans

US pop star Michael Jackson has sought a six-month extention on repayment of about a 270 million dollar loan to save his state in the Beatles catalogue and Neverland ranch. Jackson's representatives are trying to seek a six-month extention to repay the Fortress Investment Group, which owns the loans that came due on Tuesday, a media report said yesterday. Fortress purchased the debt from Bank of America in April.

The loans are collateralized by Jackson's 50 per cent partnership in Sony/ATV Music Publishing, a joint venture between the singer and the electronics company that owns a 4,000 song catalogue, containing songs as Bob Dylan's "Blowin' in the Wind" and more than 250 Beatles songs, including "Yesterday", The Los Angeles Times said.

Jackson's share in Sony/ATV, which also owns his valuable catalogue and Neverland ranch in the Santa Ynez Valley, is worth more than 500 million dollars, according to court testimony.

According to the report Fortress will demand interim payments during the extension, and may insist on an interest rate that could reach be more than 1.5 million dollar a month. Fortress also owns another Jackson loan worth 70 million dollar, that has not come due yet. Fortress declined to comment on the negotiations.

However, a spokesperson for Sony/ATV declining to discuss the specifics said the company is "trying to be a good partner, and keep the partnership with Jackson going," the daily said. Jackson's lawyers and spokesperson did not return phone calls.


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