EMI CEO Says Citi Takeover Relieves Pressure
In an extensive round of media interviews and meetings with staff yesterday, EMI CEO Roger Faxon sent a singular message: Citigroup's acquisition and recapitalization relieves pressure on the music group and makes it possible for EMI to "pay attention much more directly to the operating performance of the business and to driving for growth in the future.”
"One of the things that people don’t appreciate is that EMI was able to pay the debt service on that £3.4bn." Faxon told Music Week. “I think this will relieve that pressure. And I would say that, while of course £1.2bn is a lot of money, in the scheme of a business like this it is a pretty modest level of debt and the terms under which that debt is extended to us are good. The covenants and the way the package is, gives us substantial headroom so we are not at risk of tripping up on covenants or any of those things.”
"if you'd been at Roger's townhall for London employees yesterday, or had been at one of our American offices following his conference call to staff," one EMI staffer told Hypebot, "you'd have seen staff who were incredibly motivated and excited about the future."
Faxon and EMI have clearly scored a few wins in recent months under difficult circumstances; and now his team can focus less on debt service and more on results. It remains, however, hard to imagine that Citi's board wants to own a music group for long; or that Faxon's efforts - intentionally or not - will do little more than make a sale more profitable.