Sony Music said it is considering a bid for ailing British rival EMI, while its main rivals deny any interest or decline to comment on their intentions, according to Reuters this morning. "We are in a position that allows us to seize every opportunity in the market - including EMI," the head of Sony Music, Rolf Schmidt-Holz, was quoted as saying by German Sunday paper Frankfurter Allgemeine Sonntagszeitung.
EMI's owner, buyout firm Terra Firma, the private equity owner of music group EMI, is believed to have persuaded its investors to commit to ploughing more money into the company ahead of a crucial Friday deadline.
Terra Firma has until May 14 to inform its lender Citi-Group of its plans to pay its debt, or risk losing control of the company to the bank. Terra Firma boss Guy Hands has been lobbying its investors to plough £360 million of new investment into EMI, to be paid in two instalments to Citi.
The first tranche of £105 million will bridge the latest demands from the lender and the remainder, to be gathered in a few months, will see Terra Firma through to the end of the facility.
Warner Music Chief Executive Edgar Bronfman on Thursday declined to comment on speculation that the U.S. music company was eyeing assets of EMI. The head of BMG, the music venture owned by Bertelsmann and KKR, told the Financial Times last week BMG would not bid for EMI in the near term, even though it was seeking to replicate the success of its U.S. deal-making in the Britain. The world's largest music company Universal owned by Vivendi, said in March it was not holding talks with Terra Firma about a deal for EMI.
Terra Firma borrowed £3.2 billion from Citi in 2007 to fund its purchase of EMI, which has The Beatles, Coldplay and Kylie Minogue on its books, when the market was riding high. Relations between them soured after Terra Firma launched legal action against Citi, claiming the bank misled it over the sale of EMI. Terra Firma alleges that Citi did not inform it that a rival bidder had dropped out of the process, which they say falsely inflated the price.
Pictures of winning auction items (Jonny Buckland's VIVA guitar - Blacky) in the Coldplay end of decade clearout sale (by Jason-DeBord):
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