Terra Firma lose Citigroup claim

December 2010

Record labels

The Wall Street Journal report that EMI’s parent company Terra Firma has lost its legal dispute with Citigroup, in which it had alleged the bank misled it into paying too much to acquire the label.  Citigroup was found not guilty of fraud in a federal court in New York, after Terra Firma founder Guy Hands had alleged he was misled by Citi about competing bids for EMI. Terra Firma acquired the major label and music publisher for $6.3 billion in 2007 and the label has carried a heavy debt and Terra Firma has struggled to meet loan repayments to Citigroup. After the jury had revealed its conclusion, Citigroup’s legal representative Ted Wells criticised Terra Firma for pursuing the litigation. He told reporters: “I think Mr Wormsley was put through a terrible ordeal. He was totally innocent, he did nothing wrong. He is a man of honesty and integrity”.  EMI chief Roger Faxon insisted that the major was unaffected by the ruling, telling reporters: “EMI has had a solid operational performance over the last six months, driven by considerable success in both recorded music and music publishing. We are wholly focused on further developing our business, and on delivering positive outcomes for the talented artist and songwriter communities we are privileged to represent”.

No Comments

Comments are closed.