Private equity outfit Terra Firma yesterday said it was extending the deadline it set for the owners of the EMI Group to accept its £2.4 billion takeover offer. The prospective buyer had originally said it wanted to have secured ownership of the UK based major by yesterday, but has now extended its offer until 4 Jul.
By 1pm yesterday Terra Firma had gained acceptances from the owners of about 3.5% of the Group's overall shares. Although this sounds like a small amount, it is more than the minimum 2% that the private equity firm had said they would need to have in place in order to continue pursuing their takeover bid, and is not surprisingly low given that the large institutional shareholders will withhold their support to any takeover offer until the very last minute in a hope one or more rival offers will push up the share price.
In a statement to the London Stock Exchange, Terra Firma said yesterday: "EMI shareholders who have not yet accepted the offer are urged to do so as soon as possible and in any event by July 4".
As previously reported, there had been speculation that a rival offer from Warner Music would be made just as Terra Firma's deadline closed. No offer came yesterday. Whether the deadline extension means Warner will now make their offer next week remains to be seen. Some commentators continue to suggest Warner will not bid at this time, instead looking to buy out Terra Firma in a one deal takeover at a later date.