Terra Firma To Appeal

Topping off a week of the UK press speculation about the breakup and sale of EMI, parent company Terra Firma is seeking to appeal the outcome of its failed lawsuit against Citigroup.

The private equity firm lost its case against Citi in November after the jury ruled the bank hadn’t tricked it into overpaying for the UK’s only remaining major music company.

The Daily Telegraph claims sources close to Terra Firma are saying it will challenge the Manhattan court’s verdict and certain technical aspects of how the trial was conducted.

Terra Firma released a statement saying U.S. legal firm Boies, Schiller and Flexner has filed notice of appeal in the litigation against Citigroup.

It also said the appeal will challenge legal rulings the court made during the case.

Terra Firma is expected to breach the bank covenants on the £2.6 billion debt that Cititgroup provided to help it secure the purchase of EMI. There’s been no indication its investors are prepared to put in more cash as an equity cure.

However, an appeal through the U.S. courts could start a legal process that could drag on for years.

The Telegraph quoted a Citigroup spokesman saying the bank is confident the appeal court will confirm Terra Firma received a fair trial.