It seems increasingly likely that Universal will win European approval for its bid to buy the EMI record company this Friday, after the previously reported meeting of European Commissioners, at which the EC’s competition regulator will make its final presentation on the matter.
We still don’t know the final list of divestments Universal will have to make in order to win that EC approval, though insiders have told the Wall Street Journal that it will amount to 60% of EMI’s European assets, and will include some global catalogues. It’s still thought that on a worldwide basis, that will amount to between a quarter and a third of EMI in total.
Ironically the level of divestments being made will make it very difficult for Universal to truly deliver on its promise to reinvigorate the EMI recordings business in Europe, ie the promise it originally hoped would get EC approval with minimum concessions, given that it will no longer control over half of the EMI company across the EU; and especially in the UK where both the Parlophone and Chrysalis businesses are likely to be sold.
The WSJ reckons that approval will come in the form of a short written statement on Friday, presumably with a more detailed explanation to follow in due course. The Journal quotes an unnamed individual involved in the EC regulatory process as saying: “The die has been cast and the decision has been made, though it has come at a very heavy price for Universal. The next question is whether it will recoup the losses on its disposals and whether [the divestments] will go to a single buyer”.
Of course approval from America’s Federal Trade Commission is also still pending, though that is also expected to be confirmed within the month, allowing the Universal/EMI merger, and the sell-off of over half of EMI Europe, to begin.