ELIO OUT AT EMI MUSIC
In its statement, EMI said Leoni-Sceti had "successfully led EMI Music through the first phase of its operational turnaround," increasing sales, improving its marketshare and boosting profit margins. Seemingly decipherable between the lines was “Don’t let the door hit you on the way out.”
EMI didn’t explain why the plug had been pulled on Leoni-Sceti after 18 months, but the Financial Times threw out some plausible ideas in its coverage.
Charles Allen, the former ITV chief executive who has been non-executive Chairman of EMI Music since last January, will become Executive Chairman when Leoni-Sceti leaves on March 31. The abrupt elevation of Allen, who played a leading role in the consolidation of the U.K. TV industry, strongly suggests that the wheels are turning in earnest en route to the long-anticipated merger of EMI and Warner Music.
At ITV, Allen cut costs in putting two competing companies together and dealt adroitly with regulators, accomplishments that would stand him in good stead if an EMI/Warner pairing were to happen, note reporters Andrew Edgecliffe-Johnson, Ben Fenton and Esther Bintliff.
“Elio has done a great job,” said Allen in a statement. “Our goals for EMI Music remain the same. I will support and guide the group’s strong team, keep EMI’s focus on creativity and superb A&R, and deliver a digital platform. This is a great business—our task is to ensure it has a great future.”
Said Leoni-Sceti: “EMI is a wonderful business with a great team and new creative and operational momentum. My job here is now done and it is time for me to move on.”
The shake-up comes as Terra Firma works against the clock to come up with £120m in new funds from investors or lose EMI to Citigroup.
In an interview, Allen told FT.com: “We have put together a great team here, most recently appointing a new finance director and a new HR director and that has been the most important thing for me. We have got a team that’s really up for it and there is a real sense of positivity.”
He gave further props to Leoni-Sceti: “He came in to do some specific things and believed that he had done those things and so it was time to move on.”
Yeah, right.
“We’ve achieved a great deal in the last year or so in terms of finding new talent, developing new talent, made good progress on building a digital plan,” Allen continued, “and there has been great work by the team in the publishing business. Is there more to do? Of course there is, but we have a really good company here.”
He conceded that the overhanging issue for EMI was the debt it carried since the private equity buy-out in 2007.
“It’s an open secret that the capital structure needs to be resolved, and that is something for Terra Firma to resolve.”
