Low note: EMI carve-up

EMI is poised to be carved up after the auction of the British music group failed to flush out a bidder for the whole business.

The 80-year-old home to acts including Kylie Minogue, Coldplay and Katy Perry (pictured) will see its recorded music arm acquired by either of two rivals, Universal or Warner Music.

Warner, now in the hands of metals-to-media tycoon Len Blavatnik, was expected to bid for all of EMI but scaled back its plans so as to avoid regulatory scrutiny.

That leaves the private-equity group KKR, in partnership with German media group Bertelsmann and Sony, which has teamed up with Abu Dhabi backers, to fight it out for EMI's publishing arm. The division has rights to songs such as Over the Rainbow and Santa Claus is Coming to Town.

The first of two deals could be announced as soon as next week by Citigroup, which is offloading EMI.

The investment bank took control of the business from financier Guy Hands in February after it was declared insolvent.

The initial acquisition proved to be one of the most costly deals of the private-equity boom.

Hands' Terra Firma investment vehicle wrote off £1.75 billion.

However, if EMI raises £3 billion, Citi may break even on the deal this time around.

Citi wrote off £2.2 billion of its loan to EMI in February.