After waiting for the end for the past year to come to the major label EMI, it has finally arrived. Reported Tuesday by Billboard and Rolling Stone Magazine, Citigroup, the group that bailed out EMI, has acquired Maltby Investments Limited i.e. EMI. Citi made a debt-for-equity swap to recapitalize EMI. Which basically means that Citi swapped EMI’s debt for a certain amount of stock.
Since the take over, EMIs debts have been reduced by 65% to £1.2 billion and the bank will recapitalize the company with £300 million. “The recapitalization of EMI by Citi is an extremely positive step for the company. It has given us one of the most robust balance sheets in the industry with a modest level of debt and substantial liquidity. With that solid footing, we are confident in our ability to drive our business forward,” said EMI’s executive chief Roger Faxon.
To keep them in the news, Spotify is also close to landing a deal with EMI to license songs for use in the US. If this deal goes through, Universal and Warner would be the only two of the four majors holding out on the streaming service. As it has been trying to break into the US for a while now, its unsure whether or not this new deal will help Spotify give them a place in the US streaming. Right now, Spotify is grossly popular in seven different countries. However, out of its 10 million users only 7.5% of them pay money for the premium service. Their fear is that US consumers wouldn’t be persuaded enough to pay a monthly fee, even for unlimited access to multitude of music.