EMI Group Ltd announced in a press release today that Citigroup Inc. has acquired 100% of its share capital. The EMI Group is the parent company of Capitol Records, the American record label home of the Beatles, and Parlophone Records, the group's British label.
Immediately following the acquisition, the company said, Citigroup completed a restructuring of its debt. As a result, the announcement said, the debt has been dramatically reduced by 65% from £3.4 billion (roughly $5,400,000,000) to £1.2 billion (roughly $1,937,000,000) and the company has in excess of £300 million (roughly ($484,000,000) of cash available.
The company has been in the news because of financial problems since a 2007 buyout by Terra Firma.
In announcing the move, Roger Faxon, EMI’s chief executive, stated, “The recapitalization of EMI by Citi is an extremely positive step for the company. It has given us one of the most robust balance sheets in the industry with a modest level of debt and substantial liquidity. With that solid footing, we are confident in our ability to drive our business forward. We have already made great progress in meeting the challenges facing our industry. The closer alliance between our two operating divisions is already delivering impressive results on behalf of the creative talent we are privileged to represent. We have a clear vision for the future, a strong and committed management team, and now the right capital and financial structure in place to deliver successful outcomes for artists and songwriters.”
“Citi today took ownership of MAL, the holding company that controls EMI. In the process, the previously unsustainable debt load at EMI was reduced by 65%, leaving the company with a strong balance sheet and the ability to invest in and grow its business. This is a positive development for EMI, its employees, artists, songwriters and suppliers. Our objective is to have EMI perform its absolute best for our shareholders over time. EMI is an iconic business and we are completely supportive of both its management and its strategy. It is business as usual for everyone at EMI,” said Stephen Volk, Vice Chairman of Citi, who will be the new Chairman of Maltby Acquisitions Limited.
Today's action could be ahead of a possible company sale. EMI is reportedly one of the world's largest music companies and one of the largest global popular music publishers with a catalogue of over a reported 1 million songs. It also has an estimated 3 million recorded tracks from artists such as the Beatles, Radiohead, Coldplay and Pink Floyd.
UPDATE: EMI CEO Roger Faxon talks about the acquisition in an interview with Billboard.biz.
Comments
The slow death of the music industry proceeds as greedy fat bankers take over and squeeze the life out of it. :(
This is the slow death of the music industry as fat bankers squeeze the life out of it. :(
EMI CEO Roger Faxon says the acquisition is only a temporary thing and that EMI will be sold by Citigroup. I just hope whoever buys it is good for EMI.
I heard WEA is interested in buying EMI. And if they can't acquire the company, they're considering putting themselves up for sale! Looks like the music industry is just about dead.....sorry to say.
the record companies killed themselves with GREED (god bless america)
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