BMG Acquires Stake in New Label

Bertelsmann’s BMG record division has purchased a minority stake in Artist Direct, the latest start-up label from Los Angeles entrepreneur Ted Field, according to sources familiar with the deal.

BMG, which paid an estimated $5 million for the stake, will distribute Artist Direct’s albums in North America as part of the deal, sources said. The agreement is expected to be announced today.

The first album to be released under the pact is by the music group Custom, which signed an estimated $1.4-million contract with Artist Direct in August after the act’s departure from Virgin Records.