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EMI On The Ropes After £1.2 Billion Loss

27th October 2008 | by Aidan Williamson

It seems that even the hardiest of artists have a limit when it comes to the mixture of art and finance. Following the takeover of EMI Records by a private equity group led by Guy Hands the company engaged in some good old fashioned 'restructuring'. Like a man trying to fix a dent on his car with a sledgehammer though, the group is now facing triple the financial loss that it did under its previous owners.

EMI was down $456 million last year, this year however, saw the exodus of the label's most popular artists, including Radiohead, The Rolling Stones and Paul McCartney. This development has left the company with little in the way of flagship bands. 30 Seconds To Mars are also refusing to record any more albums for the label after claiming that following the sale of two million records, not only have they not received a penny, they're still apparently £1.2 million in debt to the label.

A spokesperson blamed the losses on the previous regime and insisted that things were on the up in the future. A warning was issued though, that the worst was not over and done with. Further restructuring charges (redundancy payments) are expected to hit the company hard as well as interest payments on their debt. Analysts suspect that this could shortly lead to a three-party-system within the major label realm of the record industry.