There has been gossip galore this weekend about the sale of EMI, as current owner reviews at least ten offers to buy its music company.
According to Billboard, it’s thought that four (possibly five) parties are bidding to buy the company outright. The first is Access Industries, which would look to merge EMI with its other recent acquisition Warner Music, subject to competition regulator approval. Also bidding to buy EMI in its entirety are the Gores Group and Platinum Equity, who also bid for Warner Music earlier this year, and equity group Permira, which bid to buy EMI way back in 2006. Apollo Global Management is also thought to be bidding, in partnership with former EMI exec Charles Koppelman, and it too may be going for the full business.
Although Citigroup has previously indicated that it would prefer to sell EMI to one suitor, some commentators reckon that splitting the business up – into publishing and recordings – would bring in more money. Thought to be bidding just for EMI’s music publishing business are KKR-backed BMG, Sony Corp and Oaktree Capital Management. Universal Music, meanwhile, is seemingly bidding for just the EMI record companies, as are MacAndrews & Forbes and Rob Perelman.
Insiders say that the top bids, in terms of price, are valuing EMI at over $3.5 billion, which could immediately put some other contenders out of the running. Some wonder if, with such a high valuation, existing music companies will be at an advantage, given they could possibly bid higher because of the economies of scale that could be achieved by merging the EMI companies with existing music operations. Though, of course, Citigroup may be wary of any deal that would bring with it possible time consuming and expensive competition regulator investigations.
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