Yesterday’s reports that EMI was mulling over the sale of its music and/or music publishing divisions have resulted in Warner Music Group trying once again to take over the company:
EMI Group PLC, the London-based music company, said Tuesday it had received a takeover approach from its competitor and longtime suitor, Warner Music Group Inc.
In a press release, EMI said Warner had made a preliminary approach, although it was uncertain whether it would lead to a formal takeover proposal. A Warner spokesman couldn’t immediately be reached.
“If a proposal is made, it will be considered with a particular focus on conditionality, the regulatory and operational risk profile, and on valuation in relation to the company’s stand alone value and the value creation available from a combination,” EMI’s statement said.
This will be the fourth attempt at a merger–and the second in a year–for the two companies, which have both had their share of problems lately. If the companies were to get jump through all the requisite regulatory hoops and, finally, get together, the EMI/Warner hybrid would command about one-fourth of the worldwide music market. Although the prospect of greater dominance shouldn’t make executives–or the stock market, which responded positively to news of this takeover–too excited; after all, it was lower-than-expected sales by one-time worldbeaters like Robbie Williams and Diddy that helped get both companies into their current, bruised state, and we doubt that news of this merger will be the defining event that inspires customers to want to start buying music again.
EMI Says It Received an Approach From Warner Music [Bloomberg]
Earlier: Idolator’s coverage of EMI