EMI is in talks to “mortgage” its back catalogue of music recordings, as Terra Firma continues its battle to keep control of the company.
According to the Times, the group is offering rival labels the opportunity to manage its North American catalogue business for a five-year period, in an attempt to raise £400m (€440m).
The sale of the division, which includes tracks by The Beatles and earns £100m per year for EMI, could raise enough cash to stave off attempts by Citigroup, which holds the company’s debt, to take control of the business.
Terra Firma boss Guy Hands has been battling to save the business almost since the day the £2.7bn deal to acquire EMI was sealed in 2007.
So far, the firm has been forced to inject new equity on more than one occasion, as well as considering a sale of the group’s iconic Abbey Road recording studios. Terra Firma has also been considering plans to tap investors for another £120m to prop up the business.
Without the extra cash, Citigroup, which Hands is suing for allegedly misleading him over the sale of EMI in 2007, could take control of the business on 14 June.
The business has also been further unsettled by rumours that KKR is in talks with Warner Music to launch a break-up bid for EMI.