Citigroup Now Owns Katy Perry
EMI Music, the home of the Beatles, Pink Floyd, Coldplay, Katy Perry, and hundreds more artists, is now the property of Citigroup, the financial company that scored all that great press during the recession ordeal. Mired in debt, equity group Terra Firma handed over ownership of the major label to Citigroup in a move that might actually make the label solvent again, but based on 2010's sales numbers, even that seems unlikely given the miserable state of the music industry. Under the deal, Citigroup also takes ownership of Capitol, Astralwerks, Priority, Virgin, and all the other record labels operating under the EMI Music umbrella.
"We have a clear vision for the future, a strong and committed management team, and now the right capital and financial structure in place to deliver successful outcomes for artists and songwriters," EMI chief executive Roger Faxon said in a statement (via Hypebot). By giving ownership of EMI to Citigroup, who recommended Terra Firma's ill-advised purchase of EMI in the first place, 65 percent of the debt that was still outstanding from the £3.4 billion purchase of EMI in 2007 has been wiped out. EMI and Citigroup were recently embroiled in a lawsuit in which Terra Firma blamed Citigroup for recommending the EMI deal.
If there's another positive in all this, it's that Guy Hands -- the Terra Firma CEO that saw the Rolling Stones, Paul McCartney, Radiohead, and most recently Queen all part ways with EMI during his awful tenure -- is no longer running things. However, it's slightly unnerving that the Beatles catalog, Pink Floyd's albums, and all the EMI artists are now a very small part of a much larger financial service company whose specialty isn't music. Speculation now is that Citigroup will eventually unload their EMI Music holdings to a company more capable of running a music business, but for the now, every time someone buys "Abbey Road" or "Teenage Dream," a portion of that money will go toward asset management or the naming rights to new baseball stadiums.