Nearly seven years after his death, the yawning, half-billion-dollar abyss of debt that Michael Jackson left behind has turned into a mountain of profit whose latest summit was topped this week thanks to a massive payday on his 50 percent stake in Sony/ATV.
The $750 million deal has Sony Corp. buying out the Jackson estate’s piece of Sony/ATV, the joint music publishing company, whose holdings include songs by The Beatles and Bob Dylan. Jackson, who died in 2009, paid $41.5 million for ATV Music in 1985. It was just the latest in a string of blockbuster moves that last year pushed Jackson to the top of Forbes‘ list of Top-Earning Dead Celebrities with a reported $115 million, ahead of Elvis Presley, Bob Marley and Marilyn Monroe.
According to that report, the singer’s estate has rung up more than $1 billion, pre-tax, to date. With the Sony deal, the estate’s executors — attorney John Branca and music exec John McClain — have pulled off what a source close to the estate called a $1 billion turnaround, from $500 million of debt to $500 million in cash. Here’s how they did it:
After feuding with the family over its release, the posthumous documentary Michael Jackson’s This Is It, released four months after Jackson passed in July, 2009, went on to become the highest-grossing music documentary of all time, with worldwide box office in excess of $300 million. The estate took in 87 percent of the back-end on the movie, with the source putting the gross figure going into the estate’s coffers at north of $200 million when TV rights and DVD sales are factored in.
In 2010, Branca and McClain brokered what a source called the biggest record deal in history, a $200 million guaranteed contract with Sony covering seven albums and other associated projects.
Jackson’s catalog continues to be a monster. Estimates of posthumous sales in the first five years after his death were in excess of 13 million in the U.S. alone. Considering that Jackson has consistently sold an estimated 70 percent of his records outside of the U.S., total sales since 2009 have easily surpassed 43 million worldwide. That makes Jackson the No. 1-selling global artist over the past seven years, surpassing such contemporary superstars as Adele and Taylor Swift.
The 2012 Michael Jackson: The Immortal Tour — an equally split joint venture with Cirque du Soleil in which the estate earned a 13 percent cut off the top of box office sales — grossed more than $370 million worldwide, making it one of the top-grossing rock tours of all time.
A permanent show at Mandalay Bay in Las Vegas, Michael Jackson: One, is another fifty-fifty joint venture with Cirque in which the estate earns a 10 percent box office take, which, like “Immortal” includes percentages for royalties and publishing. A source said the permanent performance is one of the top two grossing shows in Las Vegas, just behind Cirque’s O, earning around $90 million a year.
Money also continues to roll in thanks to the strength of the Mijac Music catalog, which holds the rights to MJ’s recordings and masters, as well as music by Sly and the Family Stone, Ray Charles, Presley and Aretha Franklin.
The estate recently renewed a deal with Bally Technologies for the Michael Jackson King of Pop slot machine, extending the pact for five more years. A source said the venture has brought in a healthy eight-figure sum so far.
Michael Jackson’s death in 2009 revealed his deep financial troubles, including over $500 million in debt. His extravagant lifestyle and legal battles worsened his situation. When Michael Jackson unexpectedly passed away in June 2009 at the age of 50, it exposed a complicated financial condition to the world. According to court records, he owed over $500 million and was deeply indebted. His lavish spending habits and legal fights have left him financially burdened despite having a lucrative career, as per the reports of ‘Yahoo Finance.’ Before his death, Jackson spent a great deal of time practicing for his ‘This Is It’ residency in London, which was a financial comeback attempt. But his debts, which amounted to $30 million a year, highlighted how desperate he was for money, according to the Los Angeles Times.
During a wrongful death trial in 2013, accountant William R. Ackerman detailed Jackson’s spending habits, including donations, gifts, travel, and art acquisitions. Jackson’s extravagant lifestyle, including jewelry purchases, contributed to his financial troubles.
Jackson’s financial woes dated back to the 1990s, with debts mounting to $140 million by 1998. From 2001 to 2009, his debt increased by another $170 million, exacerbated by high-interest loans and mounting interest payments.
As per the reports of the New York Times, to secure loans, Michael Jackson used his stake in a song catalog, including Beatles hits, as collateral. Despite financial struggles, he aimed to refocus on earning through strategic business moves and reducing debts.
In March 2024, attorneys John Branca and John McClain, along with Jonathan Steinsapir and Saul Ewing, highlighted the estate’s financial struggles following Michael Jackson’s death. They claimed that the estate faced significant debt and was nearing bankruptcy, with a valuation now exceeding $2 billion. At the time of his death, Jackson had over half a dozen lawsuits pending globally and more than 65 creditors’ claims, leading to additional litigation.
The executors managed 15 lawsuits in the U.S. and assisted with more in Europe and Japan, resolving most favorably. They successfully renegotiated and restructured financing arrangements, significantly reducing interest rates. This helped the estate avoid losing assets and satisfy the existing encumbrances.
Jackson’s estate continues to navigate complex legal and financial landscapes. They remain engaged in business operations, managing assets like the Mijac Music catalog and facing ongoing litigation, including high-profile cases with Jackson accusers.
Source: Billboard, Economic Times, Yahoo Finance, New York Times
