Citigroup has concluded its auction of EMI Group by selling the record company in two pieces for a total of $4.1 billion. Vivendi’s Universal Music Group is buying the record label side for $1.9 billion and the music publishing business is going to a group headed by Sony Music for $2.2 billion.
The total price tag was above expectations. Indeed, Citigroup had reportedly already written down the value of EMI below that, so it will owe some taxes when the sales close. The bank unwillingly got into the music business back in February when it essentially foreclosed on Guy Hands’ Terra Firma Capital. Citi had financed Terra Firma’s 2007 purchase of EMI with a $2.6 billion senior loan – about half of the purchase price.
The sales still need regulatory approvals in several countries, so closing is likely many months away. IMPALA, the trade group for European independent music labels, has vowed to fight EU approval of the sale of EMI’s label business to Universal.