Mathew Knowles to split from Sanctuary

LONDON (Reuters) – Mathew Knowles, father of R&B singer
Beyonce, said his management firm Music World Entertainment and
record label Music World Music Record Label had severed all
ties with troubled British music group Sanctuary.

Knowles said in a statement on Friday the “parties have
come to a mutual agreement to part ways,” and that he would
regain ownership of both companies.

In January Sanctuary, the world’s biggest independent music
label and home to Elton John, announced a 110-million-pound
($191 million) equity fund-raising rescue deal to save it from
losses stemming from Urban Records, a company it set up with
Knowles in September 2003.

Sanctuary said Urban Records would release no more records
after contributing to a group loss in 2005 of 143 million
pounds. Sanctuary has been cutting jobs and non-core businesses
and last year issued a string of profit warnings on the back of
troubles at Urban Records.

Sanctuary shares have been trading below 1 penny in recent
months, at 1540 GMT they stood at 0.33p valuing the company at
around 1.224 million pounds.