If nothing else, Terra Firma may set the world record for the slowest corporate buyout ever. Now that Warner Music Group has said it will not make a bid for EMI group, the meager number of shares tendered for the Terra Firma buyout has surged past 26%. But there's still a long way to go and Terra Firma has again extended the deadline – to July 29th.
It was back in May that Terra Firma, a UK-based private equity firm, won an open auction for EMI Group. But almost immediately rumors began to swirl that Warner Music Group (WMG), which had not participated in the auction, was working to put together a topper bid. WMG later encouraged that view by publicly stating that it was still interested in making a bid. Former EMI CEO Jim Fifield was also out seeking backing to make his own bid. That kept acceptances of the Terra Firma offer down in the single digits while shareholders waited to see if either would step up to the plate.
But with a bid of nearly five billion bucks on the table, British regulators stepped in and activated a legal deadline by which all counter-offers would be due. Both WMG and Fifield backed out last week, leaving only the Terra Firma offer. Even so, only a minority of shares have been tendered. We wait to see how much that grows by July 29th.