WSJ: Citi Rejects Terra Firma’s Latest Proposal To Save EMI

(Reuters) – Citigroup Inc (C.N) recently rejected a proposal from Guy Hands’ private equity firm Terra Firma Capital Partners to restructure the debt of music group EMI, the Wall Street Journal said on Monday.

The buyout firm had offered to inject about 1 billion pounds ($1.67 billion) into EMI in exchange for Citigroup waving a similar proportion of its 2.6 billion pounds of EMI loans, the paper said, citing people familiar with the matter.

Citigroup would have had to write off more debt than it was comfortable with, the paper said, citing one of the people.

Citigroup and Terra Firma could not immediately reached for comment by Reuters.

Terra Firma struck its ill-fated 4 billion pound buyout of music business EMI at the height of the buyout boom in 2007.

The ailing music group accounted for the vast majority of Terra Firma’s 1.37 billion euro writedown this year and Terra Firma was forced to inject extra capital into EMI twice in just six months.

($1=.5986 pound =.6685 euro)

(Reporting by Ajay Kamalakaran in Bangalore; Editing by Anshuman Daga)