Monday, March 8, 1999 Published at 12:06 GMT
Business: The Company File
Biscuit boss to become music maestro
The appointment of Eric Nicoli has not spiced up EMI's share price
British music giant EMI has appointed Eric Nicoli, who currently runs the McVitie's snack group United Biscuits, as its new chairman.
However the transformation of biscuit boss to music maestro has struck the wrong note with investors.
EMI's shares slumped 3% on the London Stock Exchange in early trading on Monday after Mr Nicoli's appointment was confirmed.
The shares then recovered, but were still down 10.25p at 438.5p by 1140 GMT.
Analysts believe that the constant bid speculation surrounding the group has turned off leading music executives from taking the EMI job.
There are also concerns that Mr Nicoli's United Biscuits has hardly produced tasty returns for investors over the past few years.
One City analyst said: "The market is disappointed that it isn't anyone high profile from the music and media sector - and you have to remember that United Biscuits has been a dreadful performer in recent years."
In a spin
However, it appears that EMI was keen to avoid any further disruption to a group which has undergone a tumultuous twelve months.
Mr Nicoli is already a non-executive director of the group and his promotion to chairman is being seen as a the best way not to ruffle the feathers of his fellow directors.
There are suggestions that Ken Berry, who runs EMI's music business, may have left EMI if it had appointed one of his major rivals.
Eric Nicoli is to succeed Sir Colin Southgate as executive chairman of the company on 1 May.
Sir Colin is retiring this July, a year earlier than planned.
EMI has been seen as a likely bid target as the music industry tries to cope with falling sales. However, it has so far failed to attract a bidder.
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