The proposed $20billion merger between the two record company giants has faced opposition from the European Commission...
EMI‘s proposed $20billion merger with TIME WARNER has been ditched today (October 5) in the face of opposition from the EUROPEAN COMMISSION.
Time Warner, which owns a clutch of record labels under the Warner Music banner, counting Madonna, Cher and Metallica among its artists, had discussed the possibility of selling off Virgin Records and Chappell Music Publishing to make the merger deal more acceptable.
But EC officials, who did not want the merger to go ahead because it would effectively create four giant, global record companies who would be able to fix prices, said that even those sell-offs would not be enough to salvage the proposed deal.
Time Warner‘s $127billion merger with Internet service provider AOL has been approved by the EC, however, after they made concessions to the Commission which mean that they should not be able to discriminate against rival Internet service providers for five years in the online distribution of music, according to the Financial Times.
EMI – home to Geri Halliwell, Robbie Williams, Diana Ross and Iron Maiden – and Time Warner had announced their intention to merge in January. Both parties have said they would still like to push ahead with the deal if a solution to allay the EC‘s fears could be found.
President of Time Warner Richard Parsons said the companies would “continue to explore ways to structure a combination that will make sense for the two companies and be acceptable to the Commission“, while EMI chairman Eric Nicoli said his company would also continue to look for a solution, but not at the expense of shareholder interest.