Paul McGuinness, the maverick manager long regarded as the “fifth member” of U2, has announced that he is stepping down from day-to-day management of the band. He is currently in talks to sell his company, Principal Management, to international music conglomerate Live Nation, for $30 million.
The deal, in which Live Nation would also acquire Madonna’s Maverick label, would result in the Material Girl’s manager Guy Oseary taking over management of the Irish band.
McGuinness, 64, released a statement to the Irish Times regarding his surprise business move.
“It could be seen as slightly poor etiquette for a manager to consider retiring before his artist has split, quit or died, but U2 have never subscribed to the rock and roll code of conduct,” he wrote. “As I approach the musically relevant age of 64 I have resolved to take a less hands-on role as the band embark on the next cycle of their extraordinary career.”
While McGuinness is handing over responsibility for the band’s daily operations, there is speculation that he will remain involved in the U2 management team as chairman of Principle. The company’s other artists include The Rapture and singer PJ Harvey.
Further speculation is that Oseary will take the reins, although there have been no public statements from Bono, The Edge, Larry Mullen Jr. or Adam Clayton on the subject. But McGuinness has a great deal of confidence in him.
“I have long regarded Guy Oseary as the best manager of his generation, and there is no one else I would have considered to take over the day-to-day running of our business,” he said.
The news of McGuinness’s departure comes just as the band announced plans to release its next album in April 2014.
DigitalSpy reports that U2 is putting the finishing touches on the album in New York, and is eyeing a pricey ad slot during the Super Bowl XLVIII. Some sources say that Oseary is already in place as the band’s representative and is negotiating the deals on their behalf.
U2 and McGuinness joined forces in 1978, after they were introduced by a mutual friend – Hot Press journalist Bill Graham. At 27, the Trinity College-educated aspiring manager was just a decade older than the band members, but the age difference gave him the experience to steer the wide-eyed teens away from the industry’s pitfalls.
McGuinness developed a reputation as a savvy businessman, and helped the band amass a fortune by advising them to hang on to their publishing rights and to take an ownership stake in Island Records. Among the other deals he negotiated were the high-profile collaboration with Apple on the U2 iPod, lucrative tour sponsorship from Blackberry, and the first concert streamed live on YouTube.
While McGuinness received a Lifetime Achievement Award at the 2002 Meteor Music Awards ceremony, his advice on U2’s business moves has drawn controversy.
In 2006, when the Irish government put a cap on the tax exemption for artists, he advised the band to move their song publishing operations to the Netherlands to minimize their tax liability. This decision proved controversial, with critics calling it a cynical ploy to avoid paying taxes and supporters calling it a smart business move.