Founders of Virgin Records’ U.S. Unit Quit : Music: Co-Chairmen Jeff Ayeroff and Jordan Harris deny they were pressured to resign amid rumored tension with President Phil Quartararo, who is replacing them.

British conglomerate EMI Music said Monday that Jeff Ayeroff and Jordan Harris, founders and co-chairmen of Virgin Records’ American division, have resigned.

Succeeding them as chief executive is Phil Quartararo, 37, who has been president of Virgin Records America Inc. since last year.

The much-anticipated resignations could cost the company as much as $12 million in contract buyouts, sources said. Ayeroff and Harris are leaving despite the three years each has remaining on his contract.

Ayeroff, 46, and Harris, 39, denied speculation that they were pressured to leave, saying they made the decision to resign.

“We’ve got three albums in the Top 10 right now, and we made the decision to leave when things were going great,” Ayeroff said in a phone interview from his home. “We’re walking out at a high point in the company’s history, and that’s the way we always envisioned it.”

Harris agreed.

“What we’re going to really miss is our artists and our staff,” he said. “It’s an incredible roster, and it took us seven years to build it. But when it’s time to go, it’s time to go.”

Ayeroff and Harris founded Virgin’s American division in 1986 and were named co-chairmen last year. Tensions between the duo and Quartararo have long been rumored, and sources at the company have predicted their departure since EMI Music purchased Virgin in March, 1992, for nearly $1 billion.

Several industry insiders speculated that the move is just the latest in EMI Music’s plan to place Virgin under the British conglomerate’s North American division--and to have the label report to that group’s chief executive, Charles Koppelman, within a year.

EMI has slashed more than half of Virgin’s 200-act roster and reduced its work force from 1,100 to 700 worldwide since purchasing the label.

Jim Fifield, president and CEO of EMI Music, denied Monday that EMI is up for sale or that he is trying to streamline the conglomerate’s music division to make it more attractive to potential suitors.

“EMI is totally committed to preserving Virgin’s autonomy as an independently run label within the EMI family,” Fifield said.

Ken Barry, CEO of Virgin Music Group Worldwide, also strongly denied speculation that his company will soon be folded under Koppelman’s authority.

“That’s utter nonsense,” Barry said. “Virgin is one of the hottest record companies right now. We can’t imagine why anyone would spread rumors like that.”

Former Capitol-EMI Chairman Joe Smith, who resigned from the company in April to become executive producer of the World Cup Games, attributed the resignations to disappointment with the top-heavy corporate structure.

“The situation over there must have been intolerable,” he said.

“There was just too big (of a) crowd at the top and something had to give,” he said.