Earning Your Trust
MUFG began working with Vivendi, the parent company of Universal Music Group, in 2005, since when it has become one of the company's Tier-1 lending banks.
As a highly-centralised organisation, headquartered in Paris, Universal Music Group needed a partner with a deep knowledge of both its growing global business and Treasury policy, with the network to support its operations internationally.
Over the last 12 years, MUFG has supported Vivendi through a series of loan and debt financings and was part of the €7.0bn Syndicated Financing raised for the intended SFR IPO in 2014.
In 2016, MUFG was appointed Bookrunner of a €1.5bn dual tranche bond issuance and was also awarded the Regional Interest Enhancement scheme from Universal Music Group. Under the scheme, MUFG extended a JPY loan of 6 billion, which matches the overall deposit positions in seven Asian countries, including China.
"The main challenge was to work in seven different Asian countries with complex regulations and tax rules. MUFG was able to help address and resolve all our pending issues. The work delivered by MUFG's various teams is outstanding compared to your competitors."
Staying Relevant as Your Needs Evolve
Asian markets are increasingly important to Universal Music Group, with high growth revenue streams including concerts and related ticketing sales, recording and streaming. However, in such tightly regulated markets, where significant revenues are generated in local currencies, it can be difficult for global corporates to repatriate cash.
MUFG created and implemented a cross border interest optimisation scheme, whereby Universal Music Group could avoid the core-mingling of funds and substantially reduce its FX costs.
Under this scheme, Universal Music Group was able to deposit excess cash into local MUFG branches, which the bank then returned in the form of a short-term loan in Japanese yen, at a discounted rate. This negated any need to conduct FX swaps and avoided the regulatory complications involved in Asian cross-border currency transactions.
The scheme also benefited Universal Music Group's ability to manage global liquidity. As the largest Japanese bank, MUFG was able to provide the Group with market leading rates, due to its high levels of liquidity in yen.
MUFG now maintains operational accounts for Universal Music Group in seven countries across Asia.
Securing Your Best Future
MUFG is in discussions with Vivendi Group's Canal+ treasury team to support their new joint venture operations in Singapore and Myanmar for the business's focus on cable TV subscription services.