PRIVATE EQUITY firm Terra Firma wants to appeal the US court decision that dashed its hopes for compensation from Citigroup over its £4bn purchase of music firm EMI.
Citigroup provided £2.6bn of debt for the 2007 buyout of EMI, a deal that came to epitomise the risks of loading companies with debt when the company’s performance slumped.
“Boies, Schiller and Flexner, on behalf of Terra Firma, filed a notice of appeal in the litigation against Citigroup. The appeal will challenge legal rulings made by the court in the litigation,” Terra Firma said yesterday in an emailed statement.
Terra Firma lodged a lawsuit against Citigroup at the end of 2009, claiming it was duped into overpaying for the music business. Citigroup rejected the claims.
After a high profile, three week court case in New York that pitted Terra Firma founder Guy Hands against one of Citigroup’s leading European bankers, David Wormsley, the jury found in favour of Citigroup in November.
“Terra Firma remains committed to working on a resolution for EMI that will benefit all parties involved,” Terra Firma said in the statement.
“Citigroup’s conduct in the EMI transaction was entirely proper. We are confident the appeals court will confirm that Terra Firma received a fair trial,” Citi said in an emailed statement.
The filing comes as speculation builds that Citi, which holds EMI’s debt, will end up owning the music firm which is expected to breach its banking covenants at the end of March.
City A.M. Reporter