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| Version 2 | Version 3 |
|---|---|
| Music giant EMI agrees takeover | Music giant EMI agrees takeover |
| (about 6 hours later) | |
| UK music business EMI Group has agreed to be bought by private equity firm Terra Firma for £3.2bn including debt. | UK music business EMI Group has agreed to be bought by private equity firm Terra Firma for £3.2bn including debt. |
| The group, whose artists include Robbie Williams and the Beatles, has been the subject of bid speculation for the past year as its business has struggled. | The group, whose artists include Robbie Williams and the Beatles, has been the subject of bid speculation for the past year as its business has struggled. |
| It previously rejected a takeover bid from US industry rival Warner Music. | It previously rejected a takeover bid from US industry rival Warner Music. |
| The firm has seen sales decline dramatically in recent months and said on Thursday that it had made a £260m loss in the past year. | The firm has seen sales decline dramatically in recent months and said on Thursday that it had made a £260m loss in the past year. |
| News of the bid sent EMI's shares up 9%. | News of the bid sent EMI's shares up 9%. |
| But analysts said the move was likely to bring other bidders into the fray, potentially including Warner Music. | |
| 'Minimum risk' | 'Minimum risk' |
| EMI's board of directors has recommended the 265-per-share offer from Terra Firma but the deal must be approved by the firm's shareholders. | EMI's board of directors has recommended the 265-per-share offer from Terra Firma but the deal must be approved by the firm's shareholders. |
| Terra Firma's offer delivers cash now, without regulatory uncertainty and with the minimum of operational risk to the company John Gildersleeve, EMI chairman See EMI shares | Terra Firma's offer delivers cash now, without regulatory uncertainty and with the minimum of operational risk to the company John Gildersleeve, EMI chairman See EMI shares |
| The deal values EMI shares at £2.4bn and including debt, it is worth £3.2bn. | The deal values EMI shares at £2.4bn and including debt, it is worth £3.2bn. |
| EMI said it had received a number of different offers but that the Terra Firma bid was the most "attractive". | EMI said it had received a number of different offers but that the Terra Firma bid was the most "attractive". |
| The deal is unlikely to raise the same competition issues as if EMI was being bought by one of its rivals such as Warner Music and could take just months to be completed. | The deal is unlikely to raise the same competition issues as if EMI was being bought by one of its rivals such as Warner Music and could take just months to be completed. |
| "Terra Firma's offer delivers cash now, without regulatory uncertainty and with the minimum of operational risk to the company," said EMI chairman John Gildersleeve. | "Terra Firma's offer delivers cash now, without regulatory uncertainty and with the minimum of operational risk to the company," said EMI chairman John Gildersleeve. |
| EMI TIMELINE 2000 - EMI, Warner first attempt merger2001 - EMI ends talks with Bertelsmann's BMG2003 - Reports claim EMI in talks with US private equity firm Blackstone2003 - EMI loses out in auction of AOL Time Warner music arm2006 - EMI bids for Warner. Warner counter bids for EMI.EMI rejects Permira's £2.5bn bid.January 2007 - EMI issues profit warning14 February, 2007 - EMI issues second profit warning20 February, 2007 - EMI confirms approach from Warner3 March 2007 - EMI rejects Warner's £2.1bn takeover bid18 April 2007 - EMI warns music revenues to fall 15%4 May 2007 - EMI says it has been approached by several bidders approaches21 May 2007 - EMI agrees £3.2bn deal with Terra Firma | EMI TIMELINE 2000 - EMI, Warner first attempt merger2001 - EMI ends talks with Bertelsmann's BMG2003 - Reports claim EMI in talks with US private equity firm Blackstone2003 - EMI loses out in auction of AOL Time Warner music arm2006 - EMI bids for Warner. Warner counter bids for EMI.EMI rejects Permira's £2.5bn bid.January 2007 - EMI issues profit warning14 February, 2007 - EMI issues second profit warning20 February, 2007 - EMI confirms approach from Warner3 March 2007 - EMI rejects Warner's £2.1bn takeover bid18 April 2007 - EMI warns music revenues to fall 15%4 May 2007 - EMI says it has been approached by several bidders approaches21 May 2007 - EMI agrees £3.2bn deal with Terra Firma |
| Terra Firma is run by Guy Hands, one of the UK's leading financiers. | Terra Firma is run by Guy Hands, one of the UK's leading financiers. |
| He said the deal would enable EMI to "build on its current position as one of the world's leading music companies and accelerate the development of its digital and online strategy to fully exploit this long-term growth opportunity". | He said the deal would enable EMI to "build on its current position as one of the world's leading music companies and accelerate the development of its digital and online strategy to fully exploit this long-term growth opportunity". |
| The employment rights of EMI staff and the firm's pension commitments would be maintained following the deal, Terra Firma added. | The employment rights of EMI staff and the firm's pension commitments would be maintained following the deal, Terra Firma added. |
| EMI, one of the world's "big four" record companies, has suffered a downturn in its fortunes in the past 18 months. | EMI, one of the world's "big four" record companies, has suffered a downturn in its fortunes in the past 18 months. |
| Record sales have been hit by the trend for more digital downloading of music while a number of high-profile album releases have badly disappointed. | Record sales have been hit by the trend for more digital downloading of music while a number of high-profile album releases have badly disappointed. |
| EMI announced a radical restructuring plan earlier this year, resulting in the loss of hundreds of jobs in both Europe and the US. | EMI announced a radical restructuring plan earlier this year, resulting in the loss of hundreds of jobs in both Europe and the US. |
| "The global music industry is undergoing significant change," Mr Gildersleeve added. | "The global music industry is undergoing significant change," Mr Gildersleeve added. |
| "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." | "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." |
| Other bidders? | |
| The market is now bracing itself for a counter-bid, with once-spurned Warner Music seen as the most likely candidate. | |
| "It's the beginning, not the end," said Laura Martin, from Soleil Media Metrics, of the situation surrounding EMI. | |
| "We think that it is a good thing for Warner because it gives them a clear price to beat." |