In the permutations being worked out for the sale of BMG part of music label SonyBMG, Bertelsmann is looking to retain a stake in the European part of the business, reports FT, citing sources. The company is looking to sell the 50 percent stake to Japanese company Sony (NYSE: SNE), but wants to retain a publishing catalog and a recorded business seems aimed at its home-market Germany, the world’s fourth largest music market, where Sony BMG operates labels Arialo and Gun, the story says.

Initially the price of sale was thought to be around $1.2 billion to $1.5 billion, but with this asset reshuffling, Sony may be able to buy it for a net outlay of under $1 billion. Some other factors including the role of Arvato, Bertelsmann’s media services unit, in the deal, could help bring down the costs on back-office operations and distribution.

Bertelsmann is bullish on digital and cross-platform sales of music, and the promotional value for its German shows on its RTL TV unit. For Sony, owning Sony BMG outright would allow it to experiment with offering more music on its Sony Ericsson (NSDQ: ERIC) phones and PlayStation consoles, and possibly even boost its till-now-also-ran Walkman-branded digital music players.

• Bertelsmann Wants $1.5 Billion For Sony BMG Stake, Talks ‘Advanced’: Report