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Warner Music says it won't make a takeover bid for Britain's EMI
(Associated Press WorldStream Via Thomson Dialog NewsEdge) LOS ANGELES_Warner Music Group Corp. said it has decided against making an offer to acquire rival recording company EMI Group PLC, which has a $4.9 billion (3.56 billion) private-equity takeover bid on the table.
New York-based Warner Music said on Tuesday, however, that it reserves the right to make an offer or to participate in a takeover bid for Britain-based EMI with an entity other than the private-equity firm Terra Firma Capital Partners.
A spokeswoman for EMI said the company had no comment.
EMI's board recommended in May that its shareholders accept Terra Firma's takeover offer. Since then, Terra Firma has extended a deadline for EMI to accept the offer; now the deadline is Thursday.
Many EMI stockholders have been waiting to see if Warner would come forward with a more lucrative offer.
Warner's chairman and chief executive is Edgar M. Bronfman Jr., an heir to the Seagram liquor fortune. The recording company, home to recording artists including Madonna and Red Hot Chili Peppers, has had on-and-off merger discussions with EMI over the past seven years. But the talks have been stymied on several occasions by regulatory uncertainty and the inability to agree on a price.
In the latest round, Warner offered $4.2 billion (3.05 billion) in March, but EMI rejected the bid and accepted the Terra Firma offer, led by financier Guy Hands, two months later.
EMI, which has artists such as Coldplay and Joss Stone, has said that Terra Firma's offer was the best among a number of proposals it received.
EMI shares fell nearly 2 percent to 261.75 pence ($5.34, 3.88) Wednesday in London. Shares of Warner rose $1.23 (.89), or nearly 9 percent, to $15 (10.89).
Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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