Talks to license the North American rights for Terra Firma's EMI Music unit to either Universal Music Group or Sony have ended without agreement, sources told Reuters on Wednesday.

The music business, owned by Guy Hands' Terra Firma private equity group, had held separate talks with both firms as it needed to secure cash ahead of a banking covenant test by the end of Wednesday -- part of a $2.6 billion Citigroup loan secured against the EMI assets.

But two separate sources told Reuters on Wednesday the talks had fallen through. One source who spoke on the condition of anonymity said the deal was too complicated to agree. The other source said the offers made for the licensing agreement were not acceptable.

With EMI now set to breach covenants on its debt, Terra Firma has until mid-June to inject money to get the business back within the terms of its debts.

The firm is now likely to raise money from investors to cure the covenant breach, one of the sources said.

People familiar with the negotiations had previously told Reuters that Universal and Terra Firma were discussing a fee for the licensing rights estimated around $300 million over five years.

Universal and Terra Firma declined to comment on the report. No one at Sony was immediately available to reach.

(Reporting by Simon Meads and Kate Holton; Editing by Hans Peters)