EMI Almost Sold

Written by the B&B Crew Tuesday, 01 November 2011 19:23

News -

A household name in music, British EMI is about to be sold by Citigroup who gained control of the company in February this year. As news develops, the company will most probably be divided into two separate assets – recording and publishing.

Negotiations involving the publishing company (regarded as the more valuable asset for around $2 billion), are reportedly happening with BMG Rights Management, co-owned by New York private equity firm KKR and Bertelsmann, the German media company.

On the recording side, Vivendi’s Universal Music Group, the largest music company in the world, has dropped out of the auction for any of EMI. Citigroup has been looking in the region of $3- 3.5 billion for both parts, but are considering selling the recording action for $1 billion (this division has artists like Coldplay and Katy Perry). Universal had initially been interested in the recorded music division at EMI, which has artists such as Coldplay and Katy Perry, but has reportedly dropped out of the action leaving Warner Music Group as the likely strongest contender for that part of the business.The publishing division has drawn attention by BMG Music (a joint venture between Bertelsmann and private equity firm Kohlberg Kravis Roberts), and Sony/ATV (a joint venture between Sony Corp and the estate of Michael Jackson). They are interested in the publishing unit because its funding is secure and unlike Sony Corp, it isn’t hampered by anti-trust issues. Citigroup seized control of EMI in February after its previous private equity owner, Terra Firma, defaulted on a loan.