EMI: the latest on Terra Firma and Warner Music

An update on Warner's other, ongoing story, its will-they-won't-they bid for rival music firm EMI: Terra Firma is only slowly drumming up acceptances for its £2.5bn offer for the EMI Group. Yesterday morning, the private equity firm said it would extend the offer period to 4 July after only 3.53% of EMI's shareholders accepted the bid (TF will need 90% to get control of the company).

One Numis Securities analyst speaking to AFX said he thought most shareholders would not vote on the Terra Firma offer of 265 pence a share until Warner Music either made a counter bid, or officially pulled out of the process.

But investors might not want to hold their breath for too long: A story in this morning's Daily Telegraph notes that Warner insiders think there is only a 50-50 chance of Warner Music Group finally coughing up an offer. Issues in the balance include WMG's assessment of EMI's balance sheets, which WMG has only recently started to examine; and of course whether the EU competition commission will the give the deal its regulatory blessing.

If EMI doesn't fly in the end, it will make Warner's new business move into the Russian market (see my post from earlier today) all the more poignant and worth watching.