EMPLOYEES at Blackburn's compact disc factory have been told its takeover as part of a £6 billion deal is a "positive" move for the future.

The world's biggest record company is set to be formed after electronics giant Philips agreed to sell its stake in Polygram, owners of the East Lancashire factory.

Canadian drinks and entertainment giant Seagram has agreed to buy the music and film group PolyGram in a £6.3 billion deal.

But the boss at the Blackburn site, which employs 325, said the move was being viewed positively.

"We don't see it as being any threat to the site here in Blackburn," said Bill Beddows.

"There are some concerns among the staff but I'm certain we can allay any fears," added Mr Beddows, who pointed out that Seagram currently only has one disc pressing plant in America. Under the proposed deal, which will have to take months of lengthy negotiations, PolyGram will be merged with Seagram's Universal Studios entertainment subsidiary to create what will be the world's largest music company.

PolyGram is home to rock superstars like Elton John, U2, Pulp, and Sheryl Crow, and its back catalogue includes the work of reggae star Bob Marley.

It takes in record labels including A&M, Decca, Def Jam, Island, Motown, Polydor and Verve.

Its Blackburn site produces tens of millions of CDs a year and was recently involved in the record breaking tribute disc to Princess Diana.

Seagram's Universal entertainment arm, which owns the MCA and Geffen record labels, releases music from artists such as Aqua and the Wallflowers.

To partly fund the deal, Seagram, which makes drinks including Chivas Regal, Absolut Vodka and Grolsch, is to float off its Tropicana Products fruit juice business.

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