EMI to unveil mass job cuts, asset sale

Global revamp to be announced next week

LONDON — EMI Group will announce sweeping job cuts and put non-core assets up for sale when it unveils details of its global revamp next week.

Home of Capitol and Virgin Records, EMI is expected to present plans to pare back its property portfolio and sell its stake in retailer HMV Media in a drive to streamline the group after one of the worst year’s in the industry’s history.

Alain Levy, brought on board to turn around the world’s third biggest music group, has been trawling through EMI’s sprawling empire for cost savings over the past six months and is due to present his findings to investors on Wednesday.

“Major job cuts will be a key theme of the presentation. We’re talking many hundreds out of 9,000,” said one source.

EMI could not be reached for comment. Last month, EMI’s Virgin imprint announced that it would be shuttering its West Coast operations and base the label solely in New York.

London-based EMI has had a rough ride over the past year as global album sales tumbled. Levy’s biggest splash to date has been dropping costly star Mariah Carey from her multimillion-dollar contract. But tough trading forced EMI to make its second profit warning in six months in February.

Other key themes of Levy’s presentation next week are expected to include streamlining EMI’s labels and plans to cut costs in manufacturing and distribution. EMI will also unveil its new release schedule for this year, which is expected to include a new album from top-selling Japanese artist Utada Hikaru.

EMI said last year its cost-cutting would involve a $142 million restructuring charge. Analysts had also been eager to see EMI’s $1.6 billion debt pile tackled. Merrill Lynch estimates that the sale of EMI’s HMV Media stake could raise $470 million. It added, however, that a flotation could raise twice that.

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