TEXT OF STORY
STEVE CHIOTAKIS: The Beatles record label EMI must look longingly back to its heydays of the 1960s. But record profits are now long gone. Today, the debt laden group has been taken over by Citigroup. And the label could be sold off.
From London, here’s Marketplace’s Stephen Beard.
STEPHEN BEARD: If there were a top ten of truly dreadful deals, this might be close to number one. A private equity firm — backed by Citi — bought EMI for $6.75 billion three and a half years ago. Today EMI is worth a fraction of that. Citi has written off most of its loans and the private equity firm has lost all of its investment. They hugely overpaid …at a time when record sales were slumping due to illegal downloads.
Chris Cooke of the CMU music website says that Citi will likely sell off EMI’s still lucrative publishing companies.
CHRIS COOKE: They own copyrights in vast numbers of songs and sound recordings and these copyrights are profitable. They can be turned into cash.
Analysts say Warner music and the German group BMG could be in the market for what’s left of EMI.
In London this is Stephen Beard for Marketplace.
We’re here to help you navigate this changed world and economy.
Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.
In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.
Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.