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Azoff Quits as Chairman of MCA’s Music Unit

September 6, 1989

UNIVERSAL CITY, Calif. (AP) _ Irving Azoff, who in six years resurrected MCA Records from a sleepy also- ran to the No. 2 pop music label, quit Tuesday to form his own entertainment company.

″What I want to do is a broad-based company, the cornerstone of which will be a record company,″ he said in a telephone interview. ″Basically, I intend to start the first major independent of the ’90s with major funding.″

Azoff said he was evaluating an offer from MCA to fund the venture. Asked if there had been other offers, he said, ″The phones always ring.″

Before joining MCA, Azoff achieved prominence by his deft handling of the careers of such rock superstars as the Eagles, Boz Scaggs and Steely Dan. Many thought him crazy when he decided in April 1983 to join the company he once characterized as the ″Music Cemetery of America.″

″The roster I inherited was uniquely interesting,″ Azoff said in a letter to MCA employees Tuesday. ″Could we ever forget The Catholic Girls, MCA’s answer to the Go-Go’s; Zoom, the black heavy-metal band; and Helen Reddy, best remembered as a nun in ’Airport ’75.‴

After he joined MCA, the company dropped 41 of its 46 acts and started rebuilding, often resurrecting the careers of other labels’ discards.

Most significantly, Azoff broadened the label’s base beyond rock and jazz into black music, by signing such acts as Klymaxx, Stephanie Mills, Patti LaBelle and Gladys Knight, and contemporary country, with artists such as The Judds, Lyle Lovett, George Strait and Reba McEntire.

″Today our roster boasts some of the most impressive names in contemporary including ... Bobby Brown, Elton John, Boston, Tiffany, Jody Watley, New Edition, Pebbles and Fine Young Cannibals,″ Azoff said.

A proxy statement shows Azoff was paid about $5 million in salary and stock last year. Also in 1988, Billboard magazine reported MCA had become the No. 2 pop label behind CBS Records. MCA was ranked 12th in 1983, the year Azoff signed on.

In a statement, MCA said Azoff resigned as an MCA Inc. vice president and as chairman of its Music Entertainment Group, and was working on his future plans, including possible business ventures with MCA.

Reports had circulated for several months that Azoff wanted to run his own company along the lines of David Geffen, who controls the powerful music and movie company named after him.

The trade newspaper Daily Variety said Azoff had been variously reported to be negotiating with Polygram, Warner Communications and Boston Ventures, the investment firm with which MCA teamed last year to buy Motown Records, as well as MCA itself.

MCA president and chief operating officer Sid Sheinberg referred to those talks in a news release.

″We are very hopeful that negotiations for us to continue to be involved with Irving in exciting new music entertainment undertakings will come to a successful and mutually beneficial conclusion,″ he said.

Azoff will be succeeded as chairman of MCA Music by Al Teller, a former CBS Records president who joined MCA last year as a corporate vice president and president and chief operating officer of MCA Records.

Statistics for MCA’s Music and Entertainment Group help convey how Azoff converted MCA into a challenger to such recording giants as CBS Records and Warner Bros. Records.

For the 1982 fiscal year, MCA’s recording and music-publishing operations grossed $141.7 million; for fiscal 1988, the Music Entertainment Group, which includes home-video revenues, grossed $661 million.

During his career at MCA, Azoff was plagued by allegations of conflict of interest because of his partial ownership of three outside companies that did business with MCA.

In May 1986, MCA bought the companies: Front Line Management, which handled Don Henley, Stevie Nicks, Jimmy Buffett and Heart; Full Moon Records, a small label whose artists included Dan Fogelberg and Chicago; and Facilities Merchandising Inc., which handles vending of T-shirts, caps and other novelties at more than 40 arenas nationwide.

Under Azoff, MCA Records boycotted an industry move in 1985 to put warning stickers on records that contain ″obscene″ material.

Besides the record company, the Music Entertainment Group includes MCA’s music-publishing business; its records and home video distribution unit; the Universal Amphitheater in Universal City and amphitheaters in Atlanta, Dallas and Denver; and several other businesses.

Azoff will continue to act as a consultant for the facilities merchandising unit, which Azoff founded before joining MCA.

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