Citigroup moves for buyer to control EMI -- WSJ

* Surprise potential buyer is British financier Guy Hands

* Citigroup wants control sooner than previously expected

NEW YORK Jan 27 (Reuters) - Citigroup Inc (C.N) has made contact with parties, including British financier Guy Hands, to take control of storied music company EMI Group Ltd, the Wall Street Journal reported on Thursday.

The report cited people familiar with the matter as saying Citigroup wants the debt burdened EMI business sooner than previously anticipated. A hand over would have taken place three months after a default.

Hands's buyout firm, Terra Firma Capital Partners LP, owns EMI and Hands is exploring ways in which Terra Firma can keep an ownership stake in EMI, the Wall Street Journal said. It said such a scenario could include a bid for rival Warner Music Group Corp WMG.N.

A spokeswoman for Citigroup declined to comment, as did a spokesman for Terra Firma.

Hands's emergence as a potential buyer could surprise some after he and Citigroup fought in a U.S. court last year over Terra Firma's 2007 acquisition of EMI, a music label made famous by leading groups such as the Beatles, Coldplay and other major musicians over the decades.

At the end of March, EMI's performance is expected to fall short of the targets in its roughly 3 billion pounds ($4.79 billion) of borrowings from Citigroup, the report said. Hands will likely fail to raise nearly 200 million pounds required to make up for the shortfall and the business will go to Citigroup.

The report cited its sources as saying that Hands has held talks about a new bid with CPP Investment Board, a Canadian pension-fund firm.

Other big names mentioned as potential buyers include Syco, a firm connected with TV personality Simon Cowell, U.S. private equity group Kohlberg Kravis Roberts & Co and its music publishing joint venture partner Bertelsmann AG. Rival music companies Sony Music Entertainment, Vivendi SA's Universal Music Group and Warner Music are also exploring deals for EMI, the report said. (Written by Grant McCool; editing by Andre Grenon)