EMI setback as Bronfman strikes chord with Warner
Saturday 22 November 2003
The British recording giant EMI was pondering a bleak future yesterday after it became clear its bid for the music division of Time Warner was disintegrating in the face of a richer offer from a group of investors headed by the Seagram scion, Edgar Bronfman.
Shares in EMI, which has twice before tried and failed to merge with another of the big recording companies, took a beating, at one time falling almost 11 per cent before recovering slightly on hopes that the Bronfman-Warner deal could yet unravel. They closed down 6.5p at 163p.
The acquisition of both the recording and music publishing interests of Time Warner would represent a stunning turnaround for Mr Bronfman, who has found himself out in the cold since the disastrous sale of Seagram to Vivendi three years ago.
The Bronfman consortium, put together with the children's television mogul Haim Saban and other equity groups, had been considered the dark horse in the race to win the Time Warner assets. But at a board meeting on Thursday, directors of Time Warner agreed to pursue an offer from the group valued at $2.5bn (£1.5bn).
However, all may not be lost for EMI, which previously attempted to merge with Warner Music and, on a different occasion, with Bertelsmann's BMG. Time Warner has given Mr Bronfman only until Sunday to finalise his offer. If the deadline is not met, the media giant could invite EMI back to the table.
Simon Baker, an analyst at SG Securities, said: "This is bad news for EMI. Warner Music is moving further down the horizon, if not disappearing altogether. But it is not out of possibilities and that is why the shares are not down more severely."
Mr Bronfman's involvement in the media industry began in 1995 when he decided that Seagram needed to add fizz to its staid beverages and chemicals portfolio. In a series of multibillion-dollar deals, he took control of Universal Studios and created Universal Music Group, the world's biggest record conglomerate.
He seemed to crash, however, after the sale of Seagram to Vivendi, the French water utility headed by Jean-Marie Messier, in 2000 for $34bn in stock. With Mr Bronfman at his side, Mr Messier envisaged turning Vivendi into a media powerhouse, but the company was soon swamped by debts and a collapsing stock price.
When Vivendi capitulated earlier this year and moved to sell its entertainment interests, Mr Bronfman attempted to buy them back. But he was pipped by General Electric, which already owns NBC in America. Mr Bronfman's media ambitions seemed to have been thwarted for good. By Sunday night, however, he may be firmly back in the saddle.
- 2 Katie Hopkins attacked me on Twitter — so I reported her to the police for inciting racial hatred
- 3 Gamers confess the worst things they've done in The Sims
- 4 6-year-old writes ice cold Valentine's card to his stepmother
- 5 Syrian child photographed 'surrendering to camera because she thought it was a gun'
Rape threats, death threats and a police investigation after video poking fun at an Islamic Party in Malaysia goes viral
Why Robin Williams safeguarded himself against a morbid trend in advertising
Jeremy Clarkson 'could be given minder' ahead of a potential Top Gear return
6-year-old writes ice cold Valentine's card to his stepmother
Jeremy Clarkson to become 'special adviser on transport' to David Cameron
Katie Hopkins attacked me on Twitter — so I reported her to the police for inciting racial hatred
Street preacher quoting from the Bible fined for calling homosexuality an 'abomination'
Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
David Cameron calls Labour 'hopeless, sneering socialists' while announcing 7-day NHS plans
Revealed: Putin's army of pro-Kremlin bloggers
Katie Hopkins reported to the police for race hatred by Labour MP Simon Danczuk after tweet about Pakistani men
iJobs Money & Business
£20000 per annum + commission: SThree: Sthree have an exciting opportunity for...
£18000 - £32000 per annum: Recruitment Genius: A Telesales Executive is requir...
£45000 - £50000 per annum + benefits : Ashdown Group: A highly successful, glo...
£50,000 - £55,000: Neil Pavier: Are you a professionally qualified commercial ...