U.S. takeover of EMI raises concern in Britain The Washington Post LONDON - Elvis was still king, Chuck Berry still had rockin' pneumonia and American pop stars dominated the music business on both sides of the Atlantic. Then, in the spring of 1962, a record studio on London's Abbey Road took a flyer on a catchy little ditty called "Love Me Do." That first Beatles record was probably the most important signing in the long history of EMI Group, the biggest and oldest British record company. The corporate history of EMI - for Electric and Musical Industries Ltd. - dates to the cylindrical gramophone records of the 1890s. Its contributions to the industry include the image (later borrowed by RCA) taken from the painting "His Master's Voice," showing a dog listening at a gramophone. By the early '60s, though, EMI badly needed "Help" to move beyond "Monday." Revitalized by the Fab Four, EMI signed up other British acts, including the Rolling Stones, David Bowie, the Spice Girls and Blur. Then it went global, and today it is a major world player, with a roster of regular million-sellers ranging from the Beastie Boys in the United States to the Japanese pop group Dreams Come True. Now the last British record label will become one more title on the long roster of companies clustering around America Online Inc., the Internet giant in the Washington suburb of Dulles, Va. In yet another AOL coup, EMI agreed during the weekend to merge its music business with Warner Music Group, the big American record company whose parent, Time Warner Inc., was just acquired by AOL. The transfer of yet another British corporation to U.S. hands - just days after Citigroup bought the London investment bank Schroders - prompted concern here. "U.S. takes over Britain's last major record label" read the front-page headline in Monday's Independent newspaper. There was evidence to support that point of view. The new venture will be called "Warner EMI Music." Its headquarters will be in New York. The American partner is guaranteed a majority of seats on the board, and Warner Music Group Chair Roger Ames will run the show. Both American and British executives responded defensively at a news conference here Monday when asked about a U.S. takeover. "We still have a famous British company," argued Eric Nicoli, chair of EMI Group. He noted that the London Stock Exchange will still trade EMI shares, adding, "We're acutely aware of our roots and traditions." Nicoli winced a few minutes later, though, when Time Warner Chairman Gerald Levin, addressing the same news conference from New York, referred to EMI as "our London arm." Originally on page 7A in the 1-26-2000 issue of the Daily.