Warner Music and EMI call off deal

EMI Group PLC and Time Warner Inc. have announced the withdrawal of their agreement for a merger.

EMI Group PLC and Time Warner Inc. have announced the withdrawal of their agreement for a merger.

The two giant companies have also withdrawn a merger application submitted to the European Union which proposed combining EMI Music with Warner Music Group. The EU was rumoured to be prepared to block their £15 billion merger plans despite bids from the two companies to find a compromise which would circumvent anti-monopoly rules.

But they have said they will continue to seek ways to collaborate on a joint venture as well as continuing discussions in the hope of finding a combination acceptable to regulators.

"The withdrawal of our application allows additional time to reassess regulators' concerns and to pursue solutions simultaneously in Europe and the US" said Eric Nicoli, chairman of EMI.

"We have been, and will continue to be, flexible in responding to the European Commission's concerns. "However any concessions that are ultimately made must be consistent with our shareholder value objectives."