EU details objections to Universal-EMI merger: source

(BRUSSELS) - The European Commission has sent Universal Music Group a letter outlining its objections to its proposed $1.9 billion acquisition British music label EMI, a source said Wednesday.

"There was a communication of objections," a source said, confirming a report in the New York Times that EU competition authorities had detailed their concerns about the proposed merger in a 200 page letter.

That marks a new stage in the EU's probe into the deal announced in March, in which it specifies what competition problems its sees and invites the company to respond and propose remedies.

The US daily said Commission raised concerns about the power the merged company would have on the digital music market and the calculation Universal Music Group, a unit of the French group Vivendi, used to calculate market share.

The Commission, when contacted by AFP, said it does not comment on concerns raised as part of competition probes.

When announcing the probe in March EU's Competition Commissioner Joaquin Almunia warned the deal "could reduce competition in the recorded music market to the detriment of European consumers."

The Commission said it worried the merged company may be so big it would not face sufficient price competition from competitors or even illegal downloading.

Universal Music Group last November announced its purchase of EMI from US bank Citigroup for GBP 1.2 billion (1.5 billion euros, $1.9 billion).

EMI -- home to a galaxy of stars including The Beatles, Coldplay and US pop starlet Katy Perry -- was seized by its main creditor Citigroup in February 2011 from private equity owner Terra Firma.

The purchase price represented seven times EMI gross profits before synergies, Vivendi had said.

The deal did not include EMI's music publishing unit. The EU cleared in April that sale to a group of investors led by Sony for $2.2 billion.