Abbey Road to be saved after EMI is bought back from the bankers
French-owned Universal pays £1.2bn for UK's last remaining major record company
Saturday 12 November 2011
A promise to preserve the famed studios at Abbey Road was music to the ears of some of Britain's biggest bands yesterday, despite the news that the country's only major record company was being broken in two.
Mick Jagger was among those celebrating the sale of EMI's recorded music division for £1.2bn to the French-owned Universal Music Group. He said: "I particularly welcome the fact that EMI will once again be owned by people who really do have music in their blood." Other acts also welcomed the change in ownership. Coldplay manager Dave Holmes said: "This can only be positive for the artists and executives at EMI."
The Rolling Stones singer was alluding to the corporate culture that crept in after private equity firm Terra Firma bought the company for £4.2bn of borrowed money in 2007 – as well as the rumour that Citigroup, the bank which seized EMI earlier this year when bills went unpaid, would retain ownership.
It was Terra Firma's purchase of the companythat led to the departure of one of its biggest bands, Radiohead, which set the tone for the company's slide and eventual break-up. At the time the band's guitarist, Ed O'Brien, said: "It's been taken over by somebody who's never owned a record company before, Guy Hands and Terra Firma, and they don't realise what they're dealing with."
The fate of EMI's music publishing division remains uncertain, but it is expected to be sold to a Sony-led consortium for around $2.2bn. But the end of a long period of uncertainty for its various labels, including Virgin Records and Parlophone, was seen as good news for acts ranging from rapper Tinie Tempah to pop's Katy Perry.
As EMI found itself in ever greater difficulties with its huge debts, fears were raised last year that Abbey Road could be sold to investors – possibly becoming a Beatles museum and cashing in on the tourist value of its location in upmarket St John's Wood in London. The news that it will remain a working studio was all the more welcome for an institution celebrating its 80th anniversary.
"Abbey Road Studios are a symbol of EMI, a symbol of British culture, a symbol for the creative community," said Lucian Grainge, chairman and chief executive of Universal. "This is an historic acquisition and an important step in preserving the legacy of EMI Music. As an Englishman, EMI was the pre-eminent music company that I grew up with. Its artists and their music provided the soundtrack to my teenage years."
Charting the hits the story of EMI
EMI was created in 1931 from the merger of the Gramophone Company, owner of the His Master's Voice record label with its famous Nipper the dog trademark, and Columbia Records. That same year it opened the Abbey Road studios, the first custom-built recording studios in the world.
Star signings to its roster of labels in the 1950s included Shirley Bassey and Cliff Richard, followed in the 1960s by The Beatles (pictured) and Pink Floyd and in the 1970s by Queen and Kate Bush. The company'sflagship EMI label was launched in 1973.
EMI acquired The Rolling Stones after taking over the Virgin label in 1992. More recently, artists joining the label have included Lily Allen (left), Eliza Doolittle, Norah Jones and the Gorillaz. Performers signed to other labels taken over by or licensed to EMI have included Elvis Presley and Snoop Dogg.
Financier Guy Hands took control of EMI in 2007 through his private equity firm Terra Firma but loaded the label with £3.4bn debts and fell out with Mick Jagger who moved The Rolling Stones catalogue to Universal. In February Citigroup wrested control from Mr Hands and yesterday's sale is intended to enable the bank to recoup much of its original loan to Terra Firma.
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