Citigroup takes over record company EMI

EMI, the record company that owns The Beatles, Coldplay and Lily Allen, has been taken over by the US bank Citigroup. Citigroup had loaned £3bn to private equity firm Terra Firma, to fund their 2007 takeover of the business. But, after failing to keep up with interest payments, Terra Firma has been forced to hand EMI over to Citi. 

"This is a positive development for EMI," said Citi vice chairman Stephen Volk. "EMI is an iconic business and we are completely supportive of both its management and its strategy."

Last year Guy Hands, the British financier who owns Terra Firma, began a lawsuit claiming that Citi had misled him over the acquisition. This charge was dismissed by a New York judge in October, leading analysts to predict that the US bank would shortly seize control of the business. 

Citi has agreed to write down EMI's debt from £3.4bn to £1.2bn, and has said it will eventually sell the company. Another record label, such as Warner Bros, is likely to bid.

Read a full report at the BBC. ·