Billboard.com is among the media outlets reporting that licensing talks between EMI and Universal Music Group have ended without an agreement. Negotiations ended on Wednesday morning with no commitment to a deal. EMI had been pursuing a last-minute attempt to sell temporary North American rights to its catalog to Universal. One source would not rule out that negotiations could start up again in the future. Reuters reported Wednesday that talks between Sony and EMI also ended without agreement.
EMI had been attempting to secure a five-year licensing agreement to raise funds and thereby avoid default on its sizable Citigroup debt. Today (4/1) was the deadline by which to have a licensing deal in place. Terra Firma must now go to investors in its attempt to raise $190 million by the June 12 deadline, which is when Citigroup can seize the company.
The company will point to improvements in earnings and profit over the last year when seeking additional funds that will keep its Citigroup debt in good standing. It may also point to its five-year business plan that will demonstrate further cost-cutting measures and digital initiatives.