EMI Scrubs Out Old Guard

EMI continued clearing out the house by appointing a British cleaning product manufacturer’s European business chief to head up its recorded music division.

Elio Leoni-Sceti, who oversees a range of household brands including Dettol, Harpic, Calgon, Nurofen and Clearasil, is expected to take up his new role in October.

The news comes after the London-based label had spent a year looking for a group chief executive.

Leoni-Sceti was one of six candidates in talks with EMI owner Terra Firma, according to Financial Times.

The move will see Guy Hands, who has been executive chairman of the company since his private equity group acquired EMI for £3.2 billion ($6.34 billion) a year ago, step back to become non-executive chairman.

Leoni-Sceti’s appointment continues Hands’ major clear-out of EMI’s old guard and confirms that he has decided to appoint separate chiefs for EMI Music and EMI Music Publishing.

Although Terra Firma is said to be dealing with problems caused by borrowing £2.4 billion ($4.78 billion) to buy EMI just before the credit crunch, the year-long cleanup has already led to what Hands has called a "massive reduction in waste."

Figures for the first quarter are in line with the prediction he made in front of 150 Terra Firma major investors at their annual meeting in London last month.

He told his audience that the improved results for April and May were partly due to a reduction in the percentage of CDs returned from retailers, the Daily Telegraph reported.

He said the additional sales were achieved with a far more efficient marketing and promotional spend. Other key factors were the pre-orders of the new Coldplay album and a Radiohead greatest hits record, although Radiohead has left the company and distanced itself from the release of the compilation.

Coldplay has since spent five weeks at No. 1, which augurs well for EMI’s chances of reaching the £180 million EBITDA target for the year to September, the figure it needs to achieve to meet its banking covenants.