LONDON, June 28, 2006 (AFP) – British music group EMI said Wednesday it rejected a takeover offer from US rival Warner Music worth 320 pence per share or 2.52 billion pounds (3.65 billion euros, 4.58-billion-dollars).
Warner’s informal proposal was made late Tuesday following a takeover tussle between the two music giants who are bidding for control over each other.
A combination of EMI and Warner would create the world’s third-biggest music company behind Universal Music and Sony, and would count Coldplay, Madonna, Eric Clapton, Eminem and Scissor Sisters among its roster of artists.
EMI had revealed at the start of May that Warner Music had snubbed its initial takeover bid of 4.2 billion dollars or 28.5 dollars per share.
On June 14, Warner made an informal counterbid pitched at 315 pence per share in cash or 2.49 billion pounds — but EMI snubbed the approach.
EMI responded on June 23 with an improved offer valuing Warner Music at 31 dollars per share or 4.6 billion dollars.
On Tuesday evening that was turned down by the US music company — which promptly raised its offer on the table to 320 pence per share or 2.52 billion pounds.
"The Board of EMI has unanimously rejected the revised alternative proposal from Warner Music at 320 pence per share," EMI said in the statement.
The company added that Warner Music had also "informed EMI of its rejection of EMI’s revised proposal".
News of the takeover tug-of-war sent EMI’s share price soaring as high as 311 pence in Wednesday morning deals.
It later stood at 307.75 pence — a mammoth increase of 8.46 percent from Tuesday’s close.
London’s second tier FTSE 250 index, on which EMI shares are traded, was showing a loss of 0.11 percent at 9,189.10 points.
Warner Music shares had closed at 27.23 dollars on Tuesday in New York trading, valuing the company at around 4.04 billion dollars.