BUZZ-UMG jumps to 6-month high on new Spotify deal

Shares in UMG UMG.AS jump as much as 7.6% to a six-month high after the world's biggest music label announced a new agreement with audio-streaming giant Spotify SPOT.N

They are trading 4.6% higher by 0928 GMT

The new multi-year deal in Recorded Music and Music Publishing establishes a direct license between Spotify and UMG across Spotify's portfolio

Exact terms were not disclosed

"Spotify's price increases last year did not benefit UMG ... It appears that this deal now provides UMG with a different economic treatment for both music and non-music content," ING says in a note

"It is rumoured that this deal removes the mechanical royalty bundle discount for Universal Music Publishing Group," ING adds, saying this should increase the payout for the group

Shares of Vivendi VIV.PA, UMG's third biggest shareholder, gain 3% and are at the top of France's CAC 40 index .FCHI

UMG shares are set for their best day since August if the gains hold; it trades at the top of Amsterdam's AEX index .AEX