EMI one of the worlds leading music companies is battlings for survival and faces being taken over by its bankers after failing to clinch a deal to sell the North American distribution rights for its artists to Universal Music Group or Sony Music.
The collapse of talks leaves EMI battling to raise 120 million pounds by mid-June to meet its commitments on loans from U.S. bank Citigroup. Another source familiar with discussions said that Terra Firma will talk to investors about raising the necessary funding.
If funds can't be raised from investors and the loan goes into default, Citigroup could seize EMI and cause it to be sold or broken up.
EMI has been struggling to stay afloat since it was bought by private equity firm Terra Firma Capital Partners for 4.2 billion pounds on the eve of the credit crunch in 2007, saddling the company with debt.
EMI's music publishing arm is thought to be worth about £1.2bn, although its music recording business is more difficult to value given the departure of big-name artists including the Rolling Stones and Radiohead.
The recorded music division was responsible for 55pc of EMI's £293m of profits last year.
(The Associated Press)
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