Here’s more on the “EMI is probably fucked” beat. There’s so much bad news in here, I’m not sure where to start.
First off many are viewing March as a make-or-break month for the embattled company. Last week, U.S. judge promised to rule by the end of March on whether or not to grant a request by Citigroup to move a lawsuit by Terra Firma from the States to London. The suit revolves around claims that Citi helped unfairly inflated the price paid by Terra Firma to acquire EMI.
EMI must also make a $160 million payment to Citigroup on its $4.5 billion loan by March 31, as well as pass a solvency test. EMI executives are said to be frantically working on a reorganization plan to pass the test and attract an influx of much needed new cash. If the music group falls short, Citigorup could take control (and that company doesn’t exactly have its shit together).
Meanwhile, news broke out today that CEO Elio Leoni-Sceti will be exiting after less than two years, and will be replaced with EMI Music’s non-executive chairman Charles Allen. Leoni-Sceti was an interim CEO, but regardless, the last thing EMI needs is more instability.
And Pink Floyd is suing EMI over the transition of its back catalog from physical sales to digital:
The transitional signing offers lots of opportunity for interpretation – or misinterpretation – and the members of Floyd are disputing a number of analog-to-digital ‘extensions’. Among a basket of issues, Howe is contesting moves by EMI to ‘unbundle’ music into a-la-carte singles, dismissing claims that de-coupling blocks only applied to physical formats. Also under dispute is what royalty percentages should be assigned to new, digital formats.
The band first filed the suit in April, though details are just now surfacing. The case is being heard by the High Court in London.
Eep!
