EMI Music facing loan covenant breach


Numerous reports from Europe say attempts by EMI Music to sell its North American rights to either Vivendi’s Universal Music Group or Sony Music ended without an agreement. Without such a deal, EMI Music was due to breach covenants on its $2.6 billion senior loan led by Citigroup.

Guy Hand’s Terra Firma Group, which owns EMI, has already sued Citigroup over the loan, claimed it was misled by the bank about the presence of a rival bidder. Citi has denied the claim.

Terra Firma now has until mid-June to raise 120 million UK pounds ($181.8M) for an “equity cure” of the covenant default.

RBR-TVBR observation: Will the NAB have to stop complaining that the proposed radio performance royalties will go to foreign record companies if a US bank becomes the owner of one of the big labels?