EMI single races into Hot 100

EMI Group, the demerged music company that was formerly part of Thorn EMI, is expected to see its market capitalisation race tomore than pounds 6bn in early trading when the shares make their debut on the Stock Exchange tomorrow.

However, investor caution will mean that Thorn plc and EMI Group will start life at a discount to the value of their deceased parent, which closed its stock market career on Friday with a spurt of 35p to pounds 18.25.

Market-makers expect EMI to open at around pounds 14 a share, valuing it at pounds 6bn. The shares are predicted to find plenty of buyers in the market in anticipation of a bid emerging from the US for the world's only remaining independent music business of any size.

Potential bidders include Sony, News Corporation, TimeWarner and Dreamworks, the media company set up by Steven Spielberg. But analysts expect the strongest interest to come from Seagram, owners of the MCA film and music conglomerate. "Seagram can achieve immediate synergies with EMI and MCA, and without the danger of anti-trust action," said one analyst. He added: "With the others, I really don't see where the savings will come from. It's going to be an expensive buy.".

The market believes that any bidder for EMI will have to stump up between pounds 16.50 and pounds 18 a share, which at the top end would value the company at close to pounds 8bn, or more than the combined Thorn EMI business was worth before the demerger.

A successful bidder for EMI would get access to the world's most lucrative collection of music-based intellectual property, including all of the Beatles recordings. The band's first full retrospective album, Beatles Anthology Volume One, was the company's bestseller last year with nine million sales worldwide. In addition, the company has a few hot acts of the moment including Blur, the Smashing Pumpkins, Supergrass and Garth Brooks, the US country-music singer.

Thorn, meanwhile, will open at 410p. The company, whose assets include Radio Rentals and Crazy George, the appliances rent-to-buy chain, has been left in the shade by the more glamorous EMI, but institutions have lately come out in support, citing the business's good cash-generating qualities.

Both will be included in the FTSE-100 list of Britain's largest companies, with Cookson, the conglomerate, being relegated to the junior Mid-250 index to make way for Thorn. "There was a wave of selling in Cookson when the fund managers realised it might drop out of the index, so it became a sort of self-fulfilling prophecy," said one analyst.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Financial Adviser

£20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...

SThree: Graduate Recruitment Resourcer

£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...

Guru Careers: Application Support Analyst / 1st Line Support

£25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...

Guru Careers: .NET Developer / Web Developer

£45K - £55K (DOE) + Benefits: Guru Careers: We are seeking a full stack .NET D...

Day In a Page

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence