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Terra Firma loses case against Citigroup

The latest twist in the very long and tangential saga of EMI’s latter-day travails has seen Guy Hands – chairman of EMI owner Terra Firma – lose his case against investment bank Citigroup.

The latest twist in the very long and tangential saga of EMI’s latter-day travails has seen EMI owner Terra Firma – whose chairman is Guy Hands (pictured) – lose its case against investment bank Citigroup.

A New York jury took a mere four hours to dismiss Terra Firma’s claims of “fraudulent misrepresentation” surrounding the 2007 acquisition of EMI – a purchase that proved highly controversial with some of the label’s own acts as well as the wider music industry. Hands made no comment on the decision as he departed the Manhattan courtroom.

EMI’s enduring debt problems could still force Terra Firma to relinquish control of the music company to Citigroup, which provided £2.6bn in loans for the acquisition. Hands’s ability to secure further large-scale investment could also be in doubt after the failure of this costly, high-profile action.

Despite its ongoing challenges, EMI recently announced a “significant improvement” in operating performance, including a 55% rise in operational cashflow. There have also been a raft of internal changes, not least a licensing agreement between EMI and Mute founder Daniel Miller that sees the Mute name return to independent status after eight years within the EMI group.

www.emimusic.com

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