Sources close to the label said Serletic's departure was prompted by EMI's desire to replace him with Jason Flom, who was ousted as chief executive of Warner Music Group Corp.'s Atlantic Records in August. Sources close to EMI said a deal with Flom was in the works but had not been finalized.
Serletic did not return phone calls seeking comment.
Serletic was appointed to head Virgin in early 2002, after a successful career producing albums for the groups Matchbox Twenty and Collective Soul. Soon afterward, the label relocated from Beverly Hills to New York and reorganized, losing 80% of its staff through firings or departures. The following year, Virgin ranked last in market share among the major labels.
Since then, Virgin has wooed hip-hop impresario Jermaine Dupri to head Virgin Records Urban Music and has released bestselling albums by the Rolling Stones and Gorillaz. But the label has failed to discover any new, big-selling artists.
Flom was part of the group that bought Warner Music from Time Warner Inc. for $2.6 billion in 2004. Flom was previously at Lava Records, where he developed such acts as Twisted Sister, Tori Amos and, with Serletic, Matchbox Twenty. Flom left Warner after clashing with Warner domestic chief Lyor Cohen.