Universal seeks EC approval of EMI takeover

Universal Music is poised to file with Brussels for approval of its £1.2bn takeover of EMI’s recorded music arm as early as this week.

The deal promises to create a music giant with close to a 40 per cent worldwide market share, uniting artists such as Lady Gaga and Katy Perry.

Universal will argue before the European Commission that the deal makes sense as the music industry reels from the impact of digital piracy and tumbling CD sales. It is also pledging to boost investment in artists and retain EMI’s historic Abbey Road studios.

The campaign comes as Citigroup, which seized EMI from its former owner, the financier Guy Hands’ Terra Firma vehicle, comes under pressure to put aside £500m to fund the group’s pension scheme.

The investment bank took on the liability as part of the deal to sell on EMI. Pension trustees want up to £200m to be injected immediately and a further £300m to be held in an escrow account. The pension scheme is going through an actuarial valuation. This is expected to show that between £400m to £500m would need to be put into the scheme to cover future pension payouts when Citi eventually decides to sell it on to an insurer or outside administrator. Citi is willing to put up to £200m into the scheme.