London
– Major record label EMI is planning "radical cost cuts, including a
further reduction in its 3,500-strong workforce," in a bid to make the
company more attractive to investors, the Telegraph reported. Terra Firma, the
private equity firm that acquired EMI for $4.7 billion before the recession hit,
is seeking an additional more than $160 million from investors, in order to
meet loan repayment deadlines and prevent a possible takeover by lender Citigroup.
The
cost-cutting initiative expects to shave "tens of millions of pounds"
in costs, and include another round of layoffs — following on the 3,000 staff
laid off in 2008.
The Telegraph reports that EMI’s plan envisions growing
digital from 25% of total revenues to 75% within five years, and that the
company plans to bolster its EMI Music Services licensing and merchandising
unit.
"[The five-year business plan] will involve both an acceleration in
revenues coming from product innovation at EMI Music Services and some cost
reductions from the introduction of new systems and technology and the elimination
of some duplication," EMI chief executive Elio Leoni-Sceti told the
Telegraph.
"This will confirm our vision to evolve into a digitally-led
music company.
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(Telegraph)
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(DMW previous coverage)
