A new chief faces management turmoil and an EMI merger To get an idea whether Rolf Schmidt-Holtz will cut it as chief of Bertelsmann's BMG Entertainment division, you could watch Berlin's Hertha soccer team play some weekend. Since then, Hertha has gone from the bottom of the second league to sixth-place in Germany's first league, while attendance is up tenfold. That's just one of the turnarounds on Schmidt-Holtz's resume. And he helped reverse a readership decline at Stern magazine, a Bertelsmann property, after taking over as publisher in 1988.
Management is in turmoil.
The company was further shaken in December when Rudi Gassner, Middelhoff's first choice to replace Zelnick, died of a heart attack. Together, BMG and EMI would surpass Sony Music as the biggest recording company in the world, with a roster including Radiohead and Ice Cube. Bertelsmann and EMI have reached broad agreement on terms, people close to the talks say. The hard part, though, will be steering the merger past European Union competition authorities. Last year, antitrust problems forced EMI to abandon a planned merger with Time Warner Inc.'s music unit.