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Warner Music to lay of 1000

alexd

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Warner Music to cut work force -WSJ

New owners of record business will announce job cuts that could total 1,000 employees.
March 2, 2004: 3:06 PM EST



NEW YORK (Reuters) - The new owners of Warner Music Group are expected to announce job cuts that could involve 1,000 employees, or 20 percent, of its work force, the Wall Street Journal reported Tuesday.

Investors Thomas H. Lee Partners, Edgar Bronfman Jr., Bain Capital and Providence Equity Partners Monday had completed their $2.6 billion purchase of the unit from Time Warner Inc, the parent of CNN/Money.

The new owners are expected to lay off 1,000 employees to achieve target savings of $200 million to $300 million, the Journal said, without citing specific sources.

Warner Music was not immediately available to comment.

Sources familiar with the company last week told Reuters that the new owners hoped to achieve savings of $200 million. Many music industry insiders have speculated that hundreds or thousands of employees would be cut from Warner's work force of about 5,300.

Elektra Records Chairwoman Sylvia Rhone, Atlantic Records co-Chairman Val Azzoli and Atlantic co-President Ron Shapiro all stepped down Monday, according to the Journal.

Media entrepreneur Bronfman announced the deal in November after Time Warner held unsuccessful merger discussions about the music unit with Bertelsmann AG's BMG and EMI Group Plc .

The new owners said in a statement announcing the closing of the the deal that Warner Music is now the world's largest privately held independent music company.

Bronfman, the new CEO of Warner Music, said in the statement he expects to move quickly "to implement a strategy that will enable the company not only to meet the challenges of the current environment, but also to take full advantage of future opportunities..."

Time Warner retains an option to buy up to 15 percent of the company during the next three years and as much as 19.9 percent under certain circumstances, according to the statement.
 
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