Terra Firma Moves To Stop CitiGroup EMI Takeover
In what may prove to be a last ditch effort to keep EMI from falling into the hands of lender CitiGroup, current owner Terra Firma and its head Guy Hands are appealing a recent US court decision that cleared the bank of charges that it defrauded investors during the 2007 EMI buyout. Both sides began the verbal pre-court battle with statements yesterday:
TERRA FIRMA / EMI - "Boies, Schiller & Flexner, on behalf of Terra Firma, filed a notice of appeal in the litigation against Citigroup," Terra Firma said in a statement. "The appeal will challenge legal rulings made by the court in the litigation. Terra Firma remains committed to working on a resolution for EMI that will benefit all parties involved."
CITIGROUP - "As the jury unanimously found after a three-week trial presided over by a distinguished federal judge, Citigroup's conduct in the EMI transaction was entirely proper," countered Citigroup. "We are confident the appeals court will confirm that Terra Firma received a fair trial."
Barring a quick judicial reversal, however, it is difficult to see how CitiGroup will not takeover EMI between now and a March covenant deadline to prove the solvency for the music group. CitiGroup is then expected to separate EMI's divisions to facilitate a quicker sale.