Citigroup Indicates It Wants EMI Sold In One Piece
April 12, 2011 at 4:06 AM (PT)
WARNER MUSIC GROUP has dominated the headlines lately, with news last week (NET NEWS 4/7), that YUCAIPA COMPANIES had emerged as the front-runner for WMG. Then YESTERDAY (NET NEWS 4/11), ALL ACCESS reported that OAKTREE CAPITAL MANAGEMENT and publishing company PRIMARY WAVE had submitted a joint bid for WARNER's publishing arm valued at around $1.5 billion.
But let's not forget that EMI is also for sale, and THE NEW YORK POST reports, "CITIGROUP, which took control of EMI from British financier GUY HANDS earlier this year, will seek a buyer for the entire music company rather than selling it off in pieces. EMI Chief Executive ROGER FAXON has been arguing the case for months that a breakup would hurt the U.K.-based label while CITI has pondered the best way to recoup the cash it has tied up in EMI after loaning HANDS billions for the buyout."
It's possible this decision by CITI could affect the way potential buyers are viewing a WMG purchase. Early in the sales process, there were rumors that a buyer might want to buy both EMI and WMG -- or parts of both -- and combine the two. Selling EMI in one piece would prevent that from happening.
In fact, THE POST report quotes a source that said, "EMI was recently restructured in such a way that makes it difficult to unhook publishing from its recorded-music unit."
While many names have surfaced as potential buyers of WARNER MUSIC, not too many have floated as looking at EMI. One new name, "FUND MUBADALA, a $16.3 billion investment fund backed by the ABU DHABI government, is said to have expressed an interest."