EMI Music is up for sale as one of the most precautionary tales in the history of the music industry lurches to a somewhat inevitable end. Bankers Citigroup took over the struggling label after previous owners, private equity company Terra Firma, defaulted on loan repayments after a disastrous acquisition in 2007 – and now they want to get it off their hands. The label, which in most parts is bleeding money like a stuck pig, has advised in a statement full of business speak that it would be ‘exploring strategic alternatives’. The statement reads:
EMI Group Ltd (EMI), one of the world’s leading music companies, announced today that the Board of Directors of its holding company, EMI Group Global Ltd (the “Company”), has initiated a process to explore and evaluate potential strategic alternatives, including a possible sale, recapitalisation or initial public offering of the Company.
In making the announcement, EMI stated that there can be no assurance that this strategic review process will result in a transaction. The Company does not intend to disclose developments with respect to its strategic review process unless and until its Board of Directors has approved a specific transaction.
In decoding the business speak, what they’re saying is that they’re going to try and find a buyer for the business. In essence, the only part of the company worth much is the publishing division, but it is too long and complicated a process to break it up and they’d rather palm it off to someone else to do it.
Industry speculation suggests that Russian billionaire Len Blavatnik, is a front runner to snap up the business. He’s currently in the final stage of obtaining regulatory clearance for a $3.3bn takeover of Warner Music, and it is believed that he’d like to merge them in to one, which would make for the biggest record company in the world.
