Warner gets ready for takeover offers

Marion Dakers
WARNER Music Group is ready to hear from up to 20 takeover bidders this week, a source close to the company confirmed yesterday, as the major label races to the market ahead of rival EMI.

New York-listed Warner hired Goldman Sachs last month to examine its options, which could lead to the sale of all or part of Warner, or the firm making its own takeover bid for EMI.

Private equity vehicles including KKR and Russian billionaire Len Blavatnik are among those named as interested bidders for Warner’s businesses, which could end in a sell-off of its music publishing arm Warner / Chappell or a takeover of the entire firm.

EMI has also been put up for sale by new owner Citigroup, which wrested control from Guy Hands’ Terra Firma three weeks ago in a row over its £3.4bn debt pile.

Warner is thought to be keen to beat EMI to the market, believing that there is insufficient appetite among possible buyers for two music firms at the same time.

EMI’s music publishing business, which owns the rights to over 1.3m songs including We Wish You A Merry Christmas, has a slightly larger back catalogue than Warner / Chappell, owner of Happy Birthday To You.

Warner in November posted a wider quarterly loss as revenue growth in Britain and Italy was offset by weakness in the United States, Japan and the rest of Europe, sending its shares down eight per cent.

Chief executive Edgar Bronfman said at the time that despite the challenges he remains confident that the music industry will turn the corner and soon start to benefit from years of restructuring and cost-cutting.

A UK spokesperson for Warner Music Group declined to comment yesterday, while Goldman Sachs was unavailable for comment.

Warner’s shares closed at $5.92 (£3.64) on Friday, giving the firm a market capitalisation of $888m.