

Guy Hands, head of pan-European buyout firm
Hands chose Kensington Odeon, another Terra Firma portfolio asset, as the site for a briefing with EMI employees and artist representatives, in which he reportedly announced that between 1,500 and 2,000 jobs would be culled.
The news comes just days after the
“All the signs are that the industry’s critics both in the UK and internationally will continue to attack us as part of their broader campaign against markets and globalisation,” Walker said in his message for 2008. “We must not make the mistake of believing that all we have to do is keep our heads down and that things will go back to how they were a year ago. Private equity is going to remain in the spotlight.”
Hands will know what that feels like as the former Nomura banker has rarely been out of the spotlight since the acquisition of EMI, Terra Firma’s most high profile deal to date. Something not experienced with his previous less media friendly investments such as Germany motorway operator Tank & Rast and hotel group Le Meridien.
After speculation that Hands had to return to limited partners and financial groups regarding financing after the EMI deal, a memo from Hands to employees outlining plans for the business involving widescale restructure was leaked to the press. This prompted a number of music artists to publicly question their label’s new boss.
Radiohead and Sir Paul McCartney have been EMI’s biggest losses under Terra Firma’s ownership so far – although the former actually decided against renewing its lapsed contract with EMI-owned Parlophone, rather than actually quitting, but have since criticised Terra Firma’s negotiation techniques, likening them to “confused bulls in a china shop”.
Other artists have shown concern over the number of marketing jobs and marketing spend likely to be lost in the cull affecting promotion of their music, with Coldplay, Kylie Minogue, The Verve and Robbie Williams threatening to go on “strike” or withhold forthcoming albums.
In addition to his message for 2008, Walker provided a memo outlining the BVCA’s acceptance of Sir David Walker’s code of conduct for UK private equity firms, to be monitored by the Guideline Monitoring and Review Group, chaired by Sir Mike Rake, chairman of BT.
Levels of disclosure recommended were “appropriate”, said the memo, with Ernst & Young appointed to collect and analyse more detailed data on large deals. Membership of the BVCA will be subject to signing up to the guidelines.
While in favour of a simplified approach to capital gains tax, the BVCA said that it was concerned that the rise to 18% was “higher than most European countries” and that, along with the abolition of taper relief, it “damages the UK’s competitive position”.