The future seems cloudy for struggling music label EMI, reports various internet media sources this weekend. The home of Coldplay, The Beatles and Pink Floyd is seeing a change at the top of its management. This at the same time its private equity owner is at risk of losing control of the label to Citigroup.
On Monday, the CEO of its recorded-music division, Elio Leoni-Sceti, said he would step down at the end of the month. The company also said it would promote Charles Allen to the position of executive chairman. Allen currently serves as the non-executive chairman of the company. Of greater concern could be the owner of the company, Guy Hands' Terra Firma. The equity firm is looking for a cash infusion in order to pay off loans to Citi, which was a big financier of Terra Firma's takeover of EMI in 2007. Hands has purported that Citi tricked him into buying the music label. The two sides are currently engaged in a contentious legal battle.
Should Terra Firma lose control, a company to watch will be Warner Music Group, which has "actively pursued" the company in the past. Warner's last pursuit of EMI ended as the Terra Firma deal was being pursued. Of course, there might not be much worth saving. The Rolling Stones and Radiohead have already departed the label, and Pink Floyd might not be too far behind. The group, which lambasted the record business on its classic Wish You Were Here album, and the label are at odds over royalties from sales via iTunes.
Pictures of Coldplay at Estadio Universitario, Monterrey, Mexico (11th March 2010):
Photos by Galo González