Billboard.com announced yesterday that the Warner Music Group (NYSE: WMG) has dropped plans to make a counterbid for London-based EMI Group PLC (LSE: EMI) by the deadline on Thursday, but will still retain the right to make an offer within the next six months. The only other potential bidder left to reply to the Thursday deadline now is former EMI CEO Jim Fifield.
This announcement is only the second official indication that WMG was even interested in making an offer for EMI following European private equity firm Terra Firma's offer in May. If WMG had decided to make an offer before Thursday, it would have been the second time since last year and only the most recent in a seven year game between the two music giants. It was speculated that the deadlines made for Terra Firma were because EMI shareholders were waiting for a move by WMG, while the firm had only gained around 4% of EMI shares by last Thursday. The previous bid from WMG for EMI was 315 pence per share, which was rejected (Terra Firma's 265 pence offer was approved and recommended by EMI heads, primarily because it had a higher probability of being approved by the European Commission -- which it was last week).
Despite the announcement (or in reaction to it), WMG shares rose slightly yesterday, closing at $13.77, up from $13.76 on Tuesday. EMI on the other hand, continued its fall, dropping another .13 pence to close at 266.37 pence. Trading in London for the day had brought the price as low as Terra Firma's bid of 265 pence, before rising to close slightly lower than Tuesday.
Warner Music drops plans to buy EMI
Recent Posts
BloggingBuyouts is provided for informational purposes only. Nothing on the service is intended to provide personally tailored advice concerning the nature, potential, value or suitability of any particular security, portfolio or securities, transaction, investment strategy or other matter. You are solely responsible for any investment decisions that you make. The contributors who provide the content of BloggingBuyouts may, from time to time, hold positions in the securities discussed at the time of writing and they may trade for their own accounts. Such holdings will be disclosed at the time of writing. By using the site, you agree to abide to BloggingBuyouts' Terms of Use.
