Warner Music Could Float in Spring

27 September 2004

According to inside sources, Warner Music -- the globe's fourth largest global music group -- is being lined up for an initial public offering (IPO). A floatation could value the company close to $5 billion (€4.1bn; 2.8bn).

Bought for $2.6 billion by a financial syndicate earlier this year from Time Warner, the music unit could make its appearance on the stock market by next spring, and pave the way for renewed merger discussions with the UK's EMI.

The British music giant has previously failed twice to secure a deal with Warner Music, losing out last year to a financial consortium led by ex-Vivendi Universal vice-chairmanEdgar Bronfman Jnr.

Informal talks have apparently already taken place between EMI's chairman Eric Nicoli and Mr Bronfman, but no formal negotiations have been pursued.

The regulatory approved 50-50 merger of Sony Music and BMG, coupled with the exclusion of EMI's music publishing operations, stand any potential deal in good stead. This is buoyed even more by the news that Warner Music reached annual savings of $225 million after axing more than 1000 employees.

Both Warner Music and EMI remain tight-lipped.

Data sourced from: Financial Times; additional content by WARC staff