Citi Takes Control Of EMI, Wipes Out $3.5B Debt
(UPDATE 2) EMI, the world's fourth largest label group along with a successful publishing division, are now controlled by one of America's largest banks. As predicted, Citigroup seized 100% of EMI Group Ltd. from financier Guy Hands and his Terra Firma group in a restructuring that saw the company's debt cut from nearly $5.5 billion to just under $2 billion USD. Trying to put the best face on a difficult moment for the music group, CEO Roger Faxon said in a statement:
"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."
Whatever the balance sheet, its unlikely that the bankers have any interest in owning or running a music group. Thus, leaving the sale of EMI - most likely in pieces - almost inevitable.
Stay tuned for industry reaction and details of possible suitors...
Full Text Of Statement: EMI announces successful capital restructuring, and change of ownership