Citigroup Seeks Buyers For EMI

Afraid that EMI is about to default on $4.2 billion in loans, banking giant Citigroup is reportedly shopping for buyers for the struggling music group. At least two firms, Warburg Pincus in the US and EQT in Sweden have been contacted; and the bank is open to offers from others including Warner Music, who has long coveted EMI.

Any sale, will likely be worth only half of what Terra Firma paid in 2007 and will require the signature of the firm's chief, Guy Hands. Hands is believed to be demanding that 40% of any sale be returned to the private equity firm. But the the firm's shareholders may be willing to take less, reports the Guardian, rather than see their investment eventually wiped out.

But Hands also has a few  tricks left up his sleeve in his battle to keep control including a lawsuit filed New York that moves to London this week alleging that Citi inflated EMI's price just prior to Terra Firma's purchase. Terra Firma has also offered to inject more capital into EMI if Citi restructures the debt, and is said to be looking for more investors of their own.