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EMI accepts $4.7 billion offer

21 May 2007 19:24 by James "Dela" Delahunty | 5 comments

EMI Group PLC has accepted an offer of �2.4 billion (GBP) or $4.7 billion (USD) from private equity group, Terra Firma Capital Partners. The label accepted the 265 pence ($5.23) per share takeover bid on Monday but the deal has raised speculation of an upcoming bidding war for the music company. Analysts have said that the offer could flush out a higher offer from Warner Music.

Shares of EMI finished 8.5 percent higher at 269 pence ($5.30) after the offer was made just before the closing bell on the London Stock Exchange. "The global music industry is undergoing significant change and, whilst EMI is confident in its ability to deliver its recently announced restructuring plans, significant uncertainty exists as to the timing and extent of future market developments," said EMI Chairman John Gildersleeve.

He added: "Terra Firma�s offer is the most attractive proposal received and delivers cash now, without regulatory uncertainty and with the minimum of operational risk to the company." EMI reported a net loss of 288.5 million pounds in its most recent earnings release, following a profit of 86.1 million pounds in 2006. EMI is home to artists such as the Beatles and Coldplay.

Source:
MSNBC

Permalink to this article

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Discuss this article!
borhan9 (AfterDawn Addict) 21 May 2007 21:31
I wonder if this has anything to do with EMI's deal with Amazon :) [ + quote]
DVDdoug (Junior Member) 22 May 2007 9:52
Bummer. I didn't realize that EMI had been loosing money. If they decide to, the new owners can put an end to the Amazon & iTunes DRM-free plans... Especially if Warner or another competitor comes-along with a better offer and takes-over. :( On the other hand, if they follow-through with the DRM-free plans, and it helps the company return to profitability, all of the competitors will see the light and they will have to follow the same path. [ + quote]
Tashammer (Newbie) 24 May 2007 19:43
i am wondering about all these capital equity firms that have sprung up everywhere; they borrow to the hilt to buy, then load the newly purchased company with all the debt, and then they asset strip. All of which rips the guts out the little shareholders pockets and leaves customers goodness knows where. [ + quote]
Unfocused (Junior Member) 15 June 2007 18:43
Why does it seem that there are a large number of corporate buy outs lately? [ + quote]
Tashammer (Newbie) 15 June 2007 19:22
dunno, this is an opportunity for all sorts of wild eyed speculation :-) Like maybe someone(s) are trying to set up monopolies. Maybe the Russian mafia and the other mafias ( is this a new collective noun for organised crime groups?) are moving vast amounts of ill gotten loot into legal robbery aka business (big, not small business)? [ + quote]