Citigroup, which took over EMI Group in February in an overnight debt-for-equity swap, has officially put the British music company on the auction block.

The bank released a statement Monday laying out three options for EMI, "including a possible sale, recapitalization or initial public offering of the company."

The widely expected move puts in play the world's fourth-largest music company with an estimated $2.6 billion in annual revenue.

Warner Music Group, whose board agreed in May to sell the company to industrialist Len Blavatnik for $3.3 billion, is expected to put in an aggressive bid for EMI.

If sanctioned by European and U.S. antitrust regulators, the merger would leave the market with three dominant record labels of roughly equal size, down from five just a decade ago.

Although popular in Europe and Japan, EMI's market share in the U.S. trails its rivals. For the first four months of 2011, EMI had 9.2% of U.S. music sales, compared with 30.5% for Sony Music Entertainment, 27.9% for Universal Music Group and 19.7% for Warner, according to Nielsen SoundScan.

EMI operates a number of labels, including Angel, Astralwerks, Blue Note, Capitol, Capitol Latin, Capitol Records Nashville, EMI Classics, EMI CMG, EMI Records, EMI Records Nashville, Manhattan, Parlophone, Virgin Classics and Virgin Records.

EMI, whose chief executive is Roger Faxon, cautioned that the process may not result in a transaction, but few expect Citigroup to continue its role as a music label owner.

-- Alex Pham

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Photo: EMI Chief Executive Roger Faxon. Credit: EMI Group