Kylie Minogue and Lily Allen dropped from EMI in £1.2bn takeover deal

 
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21 September 2012
The Weekender

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EMI has been forced to ditch its biggest stars including Coldplay, Pink Floyd, Kylie Minogue and Lily Allen as a condition of its takeover by Universal.

The British record giant will have to sell off record labels such as Parlophone and Chrysalis, which had some of the most famous names in pop and rock on its roster.

The European Commission today approved the £1.2  billion takeover of EMI, but only on the condition that Universal agreed to offload dozens of artists.

Among others who must leave are David Guetta, Tinie Tempah, Gorillaz, Cliff Richard, David Bowie, Tina Turner and Duran Duran, who are all signed to Parlophone.

Other key EMI labels that will have to be sold include Mute, home to the Ramones and Jethro Tull, and Chrysalis, which has Depeche Mode and Moby, as well as all of its classical music labels.

Some industry insiders fear that the heritage of EMI, which was Briitain’s last remaining major record company, could be lost following the takeover and sale of its assets.

French-owned Universal, home of Lady Gaga and Take That, insisted that the takeover was a good deal and claimed the sell-off would amount to only 30 per cent of EMI’s global revenues.

A source close to the company could not give a figure about the proportion of European assets being sold. EMI will still own The Beatles catalogue and will keep many other stars including Robbie Williams.

“We are delighted Universal Music will retain over two thirds of EMI on a global basis,” said a spokesman. “The acquisition will benefit the artistic community and music industry.”

Joaquin Almunia, EC vice-president of competition policy, said: “The very significant commitments proposed by Universal will ensure that competition in the music industry is preserved.”

But Impala, the European association of independent record labels, said the ruling was not “tough enough to curb Universal’s improved market position”.

EMI has been in limbo since last year when lenders seized control of the debt-laden group from private equity firm Terra Firma.

Alice Enders, music analyst at Enders Analysis, said: “At least EMI is back with an owner that cares about music. In a declining industry you have to consolidate to sustain profitability.”

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