Fundraising

Terra Firma launches EMI bid

The UK-based private equity group has formally launched its €2.4 billion offer for music company EMI, soon after closing its biggest ever fund. The offer also sets a deadline for any competing bids.

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Terra Firma has formally launched its attempted €2.4 billion ($3.2 billion) take-private bid for EMI, a troubled UK music company.

In a statement to the stock exchange, Terra Firma said it had posted the offer document today. Acceptances of the offer must be received by 13:00 BST on 27 June, which effectively gives any rival bidders less than a month to put forward an alternative offer.

Terra Firma is offering 265 pence per share for EMI, which values the firm at €2.4 billion. However, EMI shares continue to trade above that level, suggesting that the market believes a counter-offer may yet emerge. Its shares closed at 275.25 pence today, down one penny.

Rival Warner Music Group and former EMI chief executive Jim Fifield have both separately been linked with possible bids.

Dresdner Kleinwort is acting as Terra Firma’s exclusive financial adviser and corporate broker on the deal. It is a significant mandate for the bank’s financial sponsor team, led by Tariq Hussein. The group recently hired Mark Barrow, the former head of Close Brothers’ private equity coverage, as it looks to extend its mid-market presence.

This week Terra Firma closed its third fund with €5.4 billion of commitments, more than two and a half times the size of its previous fund.