Blackstone outmuscles Concord with $1.6bn bid for Hipgnosis
More than 65,000 songs, including tracks by Blondie and Neil Young, will be added to the music rights portfolio of the world’s largest private equity firm under the deal
29 April 2024 - 19:34
byPrerna Bedi and Yadarisa Shabong
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Bengaluru — Blackstone has agreed to acquire Hipgnosis Songs Fund for about $1.57bn, trumping an offer from Concord for the music rights owner of artists such as Shakira and Red Hot Chili Peppers, the companies said on Monday.
Blackstone’s formal offer valued the music rights investor at $1.30 per share, the companies said, higher than Concord’s $1.25 per share offer last Wednesday.
Hipgnosis shares, which have rallied since the takeover interests, rose 2.7% to £1.06 in early trade.
The deal will cause more than 65,000 songs, including tracks by Blondie and Neil Young, to be added to Blackstone’s music rights portfolio, which already includes songs by Justin Bieber and Justin Timberlake.
Blackstone has also invested in US performance rights organisation Sesac, whose affiliates include rock legend Bob Dylan and 16-time Grammy Award winner Adele.
Its sweetened offer on Monday comes days after Concord outbid the world’s largest private equity firm by 10c and had won Hipgnosis’ board backing for the deal.
The fund’s board withdrew its recommendation for the offer from Nashville-based music firm Concord.
Concord declined to comment.
“We are delighted that, after competitive interests in acquiring Hipgnosis, our investors now have a chance to immediately realise their holding at an increased premium,” Hipgnosis chair Robert Naylor said.
Blackstone is a majority shareholder in Hipgnosis’ investment adviser, HSM, which manages artists and songwriters for the fund, and holds a call option to make a higher offer for Hipgnosis’ portfolio if their advisory agreement were to be terminated.
The Blackstone proposal is independent of HSM.
Founded by industry veteran and ex-CEO Merck Mercuriadis in 2018, Hipgnosis started a strategic review last year after a shareholder vote against the continuation of the fund led to a tumultuous period and a dispute with HSM over the call option.
HSM had earlier warned Hipgnosis against terminating the advisory agreement as the previously agreed Concord deal involved the US-based firm taking over the management of Hipgnosis’ assets.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Blackstone outmuscles Concord with $1.6bn bid for Hipgnosis
More than 65,000 songs, including tracks by Blondie and Neil Young, will be added to the music rights portfolio of the world’s largest private equity firm under the deal
Bengaluru — Blackstone has agreed to acquire Hipgnosis Songs Fund for about $1.57bn, trumping an offer from Concord for the music rights owner of artists such as Shakira and Red Hot Chili Peppers, the companies said on Monday.
Blackstone’s formal offer valued the music rights investor at $1.30 per share, the companies said, higher than Concord’s $1.25 per share offer last Wednesday.
Hipgnosis shares, which have rallied since the takeover interests, rose 2.7% to £1.06 in early trade.
The deal will cause more than 65,000 songs, including tracks by Blondie and Neil Young, to be added to Blackstone’s music rights portfolio, which already includes songs by Justin Bieber and Justin Timberlake.
Blackstone has also invested in US performance rights organisation Sesac, whose affiliates include rock legend Bob Dylan and 16-time Grammy Award winner Adele.
Its sweetened offer on Monday comes days after Concord outbid the world’s largest private equity firm by 10c and had won Hipgnosis’ board backing for the deal.
The fund’s board withdrew its recommendation for the offer from Nashville-based music firm Concord.
Concord declined to comment.
“We are delighted that, after competitive interests in acquiring Hipgnosis, our investors now have a chance to immediately realise their holding at an increased premium,” Hipgnosis chair Robert Naylor said.
Blackstone is a majority shareholder in Hipgnosis’ investment adviser, HSM, which manages artists and songwriters for the fund, and holds a call option to make a higher offer for Hipgnosis’ portfolio if their advisory agreement were to be terminated.
The Blackstone proposal is independent of HSM.
Founded by industry veteran and ex-CEO Merck Mercuriadis in 2018, Hipgnosis started a strategic review last year after a shareholder vote against the continuation of the fund led to a tumultuous period and a dispute with HSM over the call option.
HSM had earlier warned Hipgnosis against terminating the advisory agreement as the previously agreed Concord deal involved the US-based firm taking over the management of Hipgnosis’ assets.
Reuters
Independent music company Hipgnosis accepts Concord takeover
Hipgnosis shareholder revolt deepens
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Most Read
Related Articles
Independent music company Hipgnosis accepts Concord takeover
Kering buys building in Milan for €1.3bn
BRIAN KANTOR: Meet the new Titans of Wall Street — private equity partnerships
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.