Northern Songs

• 1. Introduction

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  Northern Songs Ltd was the company that owned the most famous songbook in the world, and for most of its life, the men who wrote the songs did not control it. John Lennon and Paul McCartney signed away the publishing rights to their work when they were, as McCartney later put it, "21 or something in a back alley in Liverpool". That deal, struck on the 22nd of February 1963, would shape the rest of their careers and become one of the most fought-over catalogues in the history of popular music.

  What follows is the story of how a small British publishing company passed from hand to hand, survived a hostile corporate takeover, and eventually ended up in the hands of Michael Jackson. It is a story about trust, about the fine print nobody reads, and about the extraordinary gap between creating something and owning it.

• 2. A Company Is Born

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  Dick James got the attention of Brian Epstein not through a contract or a sales pitch, but through a single phone call. Epstein had arrived at James' office carrying an acetate of "Please Please Me", skeptical and reluctant. James immediately called Philip Jones, the producer of the prestigious TV show Thank Your Lucky Stars, and played the record to him over the phone, describing it as "a guaranteed future hit". Jones agreed and promised the Beatles a spot on the show. Epstein, astonished by how quickly it happened, decided James was a man he could trust.

  That trust was the foundation on which Northern Songs was built. On the 22nd of February 1963, James suggested to Epstein that forming a company together would earn more money in the long run. Lennon and McCartney believed they would own the whole thing. They did not. Each received a 20 per cent share, Epstein received 10 per cent, and James and his partner Charles Silver together held 50 per cent. George Martin was offered a stake as well but turned it down because of a conflict with his position at EMI.

  McCartney later acknowledged that he and Lennon signed every contract Epstein put in front of them without reading it. Lennon explained it plainly: "We had complete faith in him when he was running us. To us, he was the expert."

  Beyond the Beatles themselves, Northern Songs also published George Harrison's early compositions and Ringo Starr's, and a companion company called Maclen Music handled the publishing of Lennon and McCartney's work in the United States. Both were administered by Dick James Music.

• 3. Going Public

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  By 1965, Lennon and McCartney had renewed their publishing contracts with Northern Songs, binding them to the company until 1973. That same year, the decision was made to float Northern Songs on the London Stock Exchange as a way to ease the income tax burden on its principals.

  The offering drew immediate derision from financial institutions, who dismissed it as unserious. They were wrong. The application lists were expected to stay open for no more than sixty seconds, and that is exactly what happened: the listing was oversubscribed within a minute. The shares were offered at 66 pence each, far above their 17 pence face value.

  After the offer closed, Lennon and McCartney each owned 15 per cent of the company, stakes worth £195,200 each. James and Silver, who served as Northern Songs' chairmen, together held 37.5 per cent. Harrison and Starr together held 1.6 per cent. The remaining shares were distributed among various financial institutions.

  By the summer of 1966-88 songs by Lennon and McCartney had been recorded and released, and there were already 2,900 versions of those songs by different artists. To protect his business interests in that output, James took out a life insurance policy worth £500,000 on both Lennon and McCartney.

• 4. The Sale to ATV

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  Brian Epstein died on the 27th of August 1967, and with him went whatever fragile peace had held the business together. Lennon and McCartney invited James to a meeting at Apple Records in 1968, filmed the encounter, and behaved coldly towards him. Relations between James and the Beatles had already been cooling; after that meeting, they became colder still.

  In March 1969, without warning Lennon or McCartney or offering them the chance to buy him out, James and Silver sold their shares in Northern Songs to Associated Television for £1,525,000. Lennon found out from a morning newspaper during his honeymoon with Yoko Ono and immediately called McCartney.

  ATV offered Lennon and McCartney £2.3 million for their shares. They turned it down and attempted to gain a controlling interest in the company instead. The fight was long and acrimonious. Their adversary, Lew Grade, had the financial power to outlast them. But the decisive blow came from an unexpected direction: during negotiations with a small block of investors whose shares could have tipped the balance, Lennon declared, "I'm sick to death of being fucked about by men in suits sitting on their fat arses in the City!" Any investors who took offense moved to ATV's side.

  Allen Klein, acting as de facto manager for the Beatles, attempted to arrange a deal for Apple Corps to buy ATV out. That effort was derailed when attorney John Eastman, Linda McCartney's brother, sent a letter to ATV stating that Klein was not authorised to act on Apple's behalf. ATV withdrew rather than face litigation. By October 1969, Lennon and McCartney had sold their shares, Lennon's 644,000 and McCartney's 751,000, for a combined £3.5 million.

• 5. Holmes a Court and the Bidding War

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  From 1978 to 1981, the parent company of ATV Music, by then called Associated Communications Corporation, recorded declining profits due to losses in its film division, and share prices fell sharply. Lew Grade began entertaining offers for Northern Songs in 1981. McCartney, together with Yoko Ono, offered £21 million. Grade declined, preferring to sell ATV Music as a whole rather than Northern Songs alone.

  While Grade weighed his options, Australian businessman Robert Holmes a Court had been quietly accumulating shares in ACC. He launched a formal takeover bid in January 1982, forced Grade to resign as chairman, and took control of the company himself. After that, ATV Music was no longer on the market.

  It was during this period that McCartney had a conversation that would have consequences he did not anticipate. While collaborating with Michael Jackson on the song "Say, Say, Say", McCartney showed Jackson a thick booklet listing all the song and publishing rights he personally owned. McCartney was reportedly earning $40 million from songs written by others. Jackson was fascinated. He asked McCartney how the process of acquiring songs worked. McCartney recalled that Jackson said, "I'm going to get yours", meaning the Beatles' songs. McCartney thought it was a joke and replied, "Ho ho, you're good".

  In 1984, Holmes a Court put ATV Music up for sale. One notable detail: the rights to "Penny Lane" were excluded from the catalogue entirely, gifted to Holmes a Court's teenage daughter Catherine because it was her favourite Beatles song. McCartney was given first right of refusal on the catalogue. Bert Reuter, who negotiated the sale for Holmes a Court, later confirmed this, but McCartney did not bid, reportedly considering the price too high.

• 6. Michael Jackson's Purchase

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  In June 1985, Jackson and his attorney John Branca learned that The Entertainment Co., run by Charles Koppelman and Marty Bandier, had reached a tentative agreement with Holmes a Court to purchase the catalogue for £30.5 million. In early August, Holmes a Court's team came back to Jackson. Both sides made concessions. Holmes a Court added assets to the deal and agreed to establish a $1.5 million scholarship at a United States university in Jackson's name. Jackson in turn agreed to guest-star on the Channel Seven Perth Telethon, a nod to Holmes a Court's home city of Perth.

  Koppelman and Bandier actually submitted a higher bid. Jackson's offer of £24.4 million was accepted anyway, because he had completed due diligence on ATV Music before any formal agreement began and could close quickly. The deal was signed on the 10th of August 1985.

  After the acquisition, Jackson and McCartney posed together in a photograph, reportedly to dispel rumours of a falling-out over the catalogue. In a July 2009 interview on the Late Show with David Letterman, McCartney described what happened next: he had hoped that Jackson, as the owner, might finally renegotiate the publishing terms that had been in place since Lennon and McCartney were young men in Liverpool. Jackson's response, repeated across their conversations, was: "That's just business, Paul." McCartney added, "We never kind of got to it. It was no big bust-up. We kind of drifted apart after that."

• 7. The Sony Merger and Dissolution

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  Northern Songs as a legal entity did not survive the 1990s. In 1995, Jackson merged his catalogue with Sony Music's publishing arm, forming Sony/ATV Music Publishing in a deal reportedly valued at £59 million. Jackson retained half ownership. Northern Songs was dissolved that same year.

  In April 2006, a financial restructuring was proposed: Jackson would borrow £186,480,000, reduce his loan interest rate, and give Sony an option to purchase half of his stake in their jointly held company, leaving him with 25 per cent ownership. Jackson agreed to the arrangement, though the final details were not made public.

  After Jackson died in 2009, his estate eventually sold its remaining stake to Sony in 2016. The company was renamed Sony Music Publishing in February 2021, erasing the Sony/ATV name entirely.

  In 2017, it was reported that McCartney had reached a settlement with Sony in his effort to reclaim much of the Beatles' catalogue. The precise terms were not disclosed, and it was unclear how the settlement affected his outstanding copyright claims. What remained unchanged was the basic fact McCartney had been living with for decades: the deal signed in 1963, when he and Lennon trusted Epstein completely, had set the terms for everything that followed.