EMI Has Top News for Music Industry
EMI yesterday breathed some life into the down-and-out music industry with better than expected results and said it was making headway with a bid to buy Time Warner's recorded music business.
EMI, home to rockers the Rolling Stones and jazz star Norah Jones, said it had put a firm proposal on the table for Warner Music ahead of a key board meeting and suggested that its chances of getting regulatory approval for a deal were good.
Reaping the benefits of a two-year revamp that has seen failed artists and labels slashed, EMI halted a slide in sales to post flat turnover of pounds 960.3 million, outperforming a ten per cent tumble in the industry while boosting its market share.
After warning in July that a slide in Japan would dent first-half results, EMI posted an adjusted pre-tax profit of pounds 39.4 million in the six months to the end of September.
That compares with a pounds 42.2 million profit last year and analysts' consensus forecast of pounds 23.7 million.
EMI is the world's thirdbiggest music company behind Universal Music and Sony Music.
'At last! Some good news from EMI. Its first half figures have made a mockery of forecasts,' said brokerage firm Charles Stanley.
But it added: 'The stock price appears to be discounting a huge increase in profitability on the recorded music side that withouta merger with Warner looks hopelessly optimistic, and even with a merger is not assured.'
London-based EMI's talks to take over US media giant Time Warner's recorded music business come as rival music companies seek to join forces to confront a gloomy outlook of rampant piracy and falling sales.
EMI has been discussing a deal that would give Time Warner $1 billion of cash and a 20-25 per cent stake in the enlarged music business, sources familiar with the situation say. …