I.B. BAD ON EMI:
STILL WATERS RUN DEEP

While last week’s news of EMI being approached by one or more private-equity consortiums hasn’t been advanced in the media, there’s word from inside the company of a sudden flurry of activity, with various executives being summoned back to London and staffers being told to cut back dramatically on expenditures of all kinds.

The situation has caused deal negotiations between EMI and Jermaine Dupri to hit a stalemate, say those in the know. EMI’s inability to close the deal is being perceived by Dupri, et al., as a breach, possibly creating free agency for the hotly pursued producer/executive.

Meanwhile, in London, numbers crunchers are furiously crunching away, strongly suggesting that a proposal to buy the company is being hammered out. Once a number is made public, a chain reaction is likely to take place within the private-equity sector, with virtually every major player stepping forward to kick the tires. That number, which most believe will be in the vicinity of $5 billion, is not big money for these deep-pocketed outfits, but with all the recent focus on the music business on the part of Wall Street, these companies will want to give EMI close scrutiny as a potential target.

While the company appears to be in play, the key question is whether a sufficiently attractive offer will be put on the table for the EMI Board to green-light it. Much more to come.