Following Sony and WMG, EMI Music is the next major label to show major trouble this year. Private equity firm Terra Firma has handed over an additional $45 million in new financing to the struggling company to avoid breaching its debt agreements, according to the Wall Street Journal on Friday.
In 2007, Terra Firma bought EMI Group for $4.7 billion. Since the acquisition, the major label has undergone a major company-wide restructuring effort and aggressive cost-cutting measures meant to slash about $300 million from operating costs. In addition to the new cash influx, EMI just received $26 million from Terra Firma in September 2008. The new funding is reportedly being provided to ensure payments on a multi-billion dollar loan from Citigroup, according to sources of The Journal.
In addition, EMI Music CFO Chris Kennedy, who was just appointed in April 2008, has left his post for another position “overseeing the company’s investments.” Terra Firma finance executive Andrew Chadd will take over in the interim.
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Related Links:
Wall Street Journal “Terra Firma Gives EMI More Money”
Digital Media Wire “WSJ: Terra Firma Sinks Another $45 Million into EMI”
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