The Stool Pigeon music newspaper

The takeover of EMI records by private equity firm Terra Firma has seen its first casualties after CEO Eric Nicoli and finance director Martin Stewart joined in an act of corporate hari kari. The pair agreed to depart with massive pay-offs after EMI turned in another set of dismal results under their stewardship. The news came as a shock to EMI staff and the industry, and will no doubt fuel fears of a massive clear out of staff and artists as the private equity firm seeks to make the label profitable. Revenues from EMI’s recorded music division fell by 13.4 per cent between April 1st and August 6th 2007. Publishing revenues increased by 11.9 per cent, still leaving the whole group 5.1 per cent down in the period.

Insiders have long suspected that Terra Firma will wield the hedge-fund strimmer and seek to wind down the loss-making record releasing side of the business, retaining only the publishing arm. However, Nicoli, (no doubt lubricated by a whopping 3.3 million severance deal) issued a memo saying that he felt the future of the label is in “safe hands”. But who do these hands belong to? The departing pair will be replaced by new Chief Operating Officer Chris Roling, formerly of chemical giants ICI; director of business transformation Ashley Unwin, a management consultant from Deloitte Consulting; and strategic business relationship consultant Julie Williamson, who previously oversaw Terra Firma’s refinancing of German motorway service station operation Tank & Rast. We’d love to have a look at their record collections.

Williamson will use the expertise gleaned from sorting out Germany’s Teutonic Ginsters to work out the company’s digital strategy, and arrange new deals with Apple’s iTunes and other platforms.

Nicoli’s leaked memo enthuses that, “The new board is a strong and experienced one with a track record in transforming businesses for future growth. They respect the talents of our artists and employees, and EMI as an iconic, high quality and world-renowned brand. I am absolutely confident that EMI is about to enter an exciting new era of investment and growth”.

A memo from Terra Firma boss Guy Hands, leaked to Music Week, hints at his new strategy for the label. He writes that he hopes to build the “world’s most innovative and consumer-focused music company and the best home for musical talent” and was looking forward to “working with everyone at EMI and with the EMI artists to create a truly unique and independent music company”.

More content of interest...

• Pull your finger out says new EMI man to artists (Posted in 014 December 2007 | Business News)
• EMI boss hands Standard hack an accidental scoop (Posted in 017 June 2008 | Business News)
• Guy Hands out 2,000 P45s to EMI staffers (Posted in 015 March 2008 | Business News)
• Leaders (Posted in 016 May 2008 | Comment & Analysis)
• Business Morsals (Posted in 017 June 2008 | Business News)