FOX’S FRIEDMAN ON QUASHED WMG-EMI MERGER

That's according to Roger Friedman's Fox News report, which can be found here.

Friedman claims Bronfman “had the chance to merge the two companies, remain CEO and brilliantly regroup into a powerhouse. He could have combined the Beatles with Atlantic Records' catalog, streamlined into a mega giant and been awarded kudos from all corners.”

Instead Snyder’s lawsuit illuminates “the whole mess as it went down.”

Bronfman first met Snyder on a family vacation in Anguilla in 2001, then invited him to help create deals for investment. The ex-publishing exec claims he was the architect of the Warner Music deal, and that once it was completed, Bronfman unceremoniously dumped him and refused to give him his cut. Snyder is suing for $100 million.

Bronfman says he merely rented office space to Snyder, who was down on his luck. Friedman claims the papers filed by Snyder “carefully indicate otherwise, including memos in which Snyder was cc'd, and names of executives with whom Snyder did business on behalf of Bronfman.”

Friedman points to a letter from EMI chairman Eric Nicoli dated Feb. 9, 2004, to Bronfman and Scott Sperling of Thomas H. Lee Partners, titled "Proposal for Acquisition of Warner Recorded Music and Part of Warner-Chappell Music Publishing."

In the letter, Nicoli outlines an offer to merge with Bronfman's new WMG for $1.6 billion in cash, and reiterates a plan by which Bronfman would become CEO of the "enlarged EMI Group."

Nicoli suggests then-EMI Music head Alain Levy become CEO of the Music Group and Martin Bandier become CEO of EMI Music Publishing. All Nicoli asks is that his EMI executives remain in place through the new company, reminding Bronfman the offer expires in two days.

According to Friedman, Bronfman got cold feet. On Feb. 11, Nicoli e-mailed Bronfman: "We understand you do not wish to pursue our offer," copying Sperling. Bronfman circulated the e-mail to Snyder and to his brother-in-law Alejandro Zubillaga, the same man who reportedly dumped more than 100k shares of Warner Music Group recently.

The next day, Bronfman sent a memo to Roger Ames, the head of Warner Music, to start "consolidation," i.e. layoffs: "We should not only get additional ‘granularity’ on exactly which employees will be leaving, we will also need to identify the top 30 or 50 people we will want to communicate with for retention."

Friedman points out the e-mails and memos presented as exhibits prove just how much Snyder had to with guiding Bronfman, and how little Bronfman regarded his involvement.

Friedman claims the papers prove Snyder worked for months to put the merger deal together while at the same time orchestrating Bronfman’s purchase of Warner Music from Time Warner.

Evidence of the EMI merger proposal is found in a business plan called "Wolf Merges with ELK," which Snyder oversaw (Wolf was Warner; ELK was EMI). Armed with this research, Snyder hosted Bronfman and Nicoli at his New York farm in January 2004 to hammer out the details.

But Friedman claims that Bronfman “balked” because he was worried that he could somehow be terminated from his position as CEO and feared EMI's Alain Levy, second in command, could unseat him.

"When Snyder then told Bronfman Jr. that Levy could not be terminated simply because Bronfman Jr. regarded him as a rival, Bronfman Jr. became agitated," court papers said.

In the end, Bronfman moved into new Warner Music digs, and ceased relations with Snyder abruptly, as if the entire episode had never occurred.

As Freidman points out: “In the time since the 2004 deal didn't go down, ironies abound as well: Ames is not only gone, but he now runs EMI. Levy and Bandier are gone from EMI. Bandier took over rival Sony/ATV Music Publishing. Jason Flom, set to rule Bronfman's new Atlantic Records before getting canned by Lyor Cohen in a memorable encounter at LAX, is also now at EMI, heading up the merged Capitol Music Group. And this week, EMI is considering offers from private firms after receiving unacceptable bids from Warner since this previously unknown one in 2004."