UMG-Citi talks continue

EMI, ROUND BY ROUND: UMG will continue talks with Citigroup today in hopes of settling a host of issues that have hindered a deal for EMI’s recorded-music business, the N.Y. Post’s Claire Atkinson reports, advancing yesterday’s story (see 11/8 items). On the table for UMG are such issues as $640 million in pension liabilities, carrying the entire risk of potential antitrust problems and taking on problems related to EMI’s former ownership of the defunct HMV chain. Lending further credence to UMG’s supposed seriousness are a pair of stories in this morning’s Wall Street Journal. The first piece—under a byline that includes media reporters Dana Cimilluca and Ethan Smith—describes the talks as “advanced” and claims that UMG is “moving to the head of the pack in an auction it had only recently stepped away from, according to people familiar with the matter… Warner Music Group owner Access Industries appears resigned to losing the auction, according to two of the people.” This is an odd turn of events considering that WMG’s Len Blavatnik had bid considerably more than Universal. And the second WSJ piece, by John Jannarone, makes another pertinent point, pointing out that the addition of EMI would put UMG’s marketshare at just under 40%, representing a giant red flag for antitrust regulators. (11/9a)