EMI is happy going solo

EMI chairman Eric Nicoli has vowed not to seek another deal for the music group if he is unable to resurrect the merger with Time Warner.

EMI chairman Eric Nicoli has vowed not to seek another deal for the music group if he is unable to resurrect the merger with Time Warner.

The £11bn deal was dropped last week after Time Warner and EMI could not find a formula that would please Mario Monti, the European Competition Commissioner, despite offering to sell both Virgin Records and Chappell, the music publisher.

EMI and Time Warner said they would go back to the drawing board and try to come up with a fresh deal that would please the regulators.

Despite this, the market is sceptical that anything can be achieved and has already pencilled in other potential deals.

Top of the list is a merger with Bertelsmann, the German media group whose chief executive, Thomas Middelhoff, boasted that the company would be number one in music by the end of 2001. However, such a deal is unlikely to find favour with Mr Monti, either.

Another possible deal might come via a bid from Telefonica, the Spanish telecoms giant, which is keen to buy content providers.

The third is a rumoured tie- up with News Corp, although Rupert Murdoch is believed to think EMI is too expensive.

Mr Nicoli, who ran United Biscuits before moving into music, told the Independent on Sunday that he favours none of these options. "Our prospects are excellent whether we are in partnership with Time Warner or driving the business forward on a stand-alone basis," he said.

EMI, whose roster includes the Spice Girls, Blur and Lenny Kravitz, is currently pinning its hopes on good sales from the controversial new Radiohead album, Kid A.