Terra Firma’s EMI Group has recruited Google’s chief information officer Douglas Merrill to oversee the development of a new digital music business.
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Guy Hands: |
Merrill becomes the first president of digital music at EMI. His role oversees all aspects of the company’s digital strategy, including innovation, business development, the supply chain and global technology activities.
Merrill joined Google late in 2003. During five years at the internet company he rose to become chief information officer and vice president of engineering. He was responsible for all billing and revenue technology and processes for Google worldwide as well as internal engineering and support worldwide.
He led numerous strategic efforts at Google, which included: its 2004 initial public offering, which raised $1.67 billion and gave the company a market capitalisation of $23.1 billion; the 2006 launch of Google Checkout, creating a “multi-billion dollar business”; the 2007 turnaround of Google’s radio advertising business, which included organising a partnership with media company Clear Channel, enabling Google to sell advertising on its partner’s radio stations.
The high profile recruit is likely to be joined by more senior management. EMI has said in earlier announcements it is looking to complete its management changes by the end of June. Hands’ arrival has led to various senior staff leaving EMI, including Tony Wadsworth, former chairman and chief executive of EMI in the UK and Ireland, who left in January.
Terra Firma chief executive Guy Hands has also taken on the role of interim chief executive the music company, as well as the role of chairman. It is unlikely that he will step down from the chief executive position by this deadline, according to a source close to the company.
“The planned management changes refer to further down the food chain,” the source said.
The €5.8 billion take-private of EMI was completed as the turmoil in the worldwide global credit markets became apparent. Industry insiders and analysts fear that the turnaround may be beyond even Hands’ talents.
But the source said the company is, so far, financially ahead of plan. He declined to comment on financial details.
The UK buyout firm has highly ambitious plans to improve the efficiency of the group, which had underlying EBITDA of £174 million in the financial year to 31 March 2007.
These plans involve between 1500 to 2000 job cuts and an attempt to decrease waste at the group.
The recorded music business at EMI had revenues of £1.35 billion in the financial year to 31 March 2007, but earnings before exceptional items, amortisation, and tax of £45 million. This is in contrast to the more strongly performing music publishing business, which had revenues of £401 million but higher earnings at £106 million
