Concord tops Blackstone in bidding warfare for Hipgnosis | USAEMALL.com

Unlock the Editor’s Digest without spending a dime

Roula Khalaf, Editor of the FT, selects her favorite tales on this weekly publication.

Hipgnosis Songs Fund has discovered itself on the centre of a bidding battle after Apollo-backed US funding group Concord topped a rival supply from Blackstone by elevating its personal strategy to $1.5bn.

Blackstone over the weekend made a proposal to the corporate’s board to amass the music rights group for $1.24 per share in money to attempt to derail the beneficial supply from Concord.

On Wednesday Concord stated it could enhance its bid to only over Blackstone’s, and supply $1.25 for every share for Hipgnosis Songs Fund (HSF). Concord stated it “remains committed to becoming the new owner of Hipgnosis”.

The supply has once more been beneficial by the Hipgnosis board, which stated it was “in the best interests of Hipgnosis shareholders as a whole”.

Hipgnosis was based by music government Merck Mercuriadis in 2018 to show music rights right into a mainstream asset class. It owns a big portfolio of music that features the Red Hot Chili Peppers and Shakira.

Shareholders final yr voted towards the continuance of the corporate, sparking a strategic overview by a brand new board and in the end a sale course of. 

Concord’s supply on Wednesday will once more throw the way forward for the music rights firm into query, with these near Blackstone saying the personal fairness group was contemplating its choices. Blackstone has made repeated, however decrease, provides for the corporate.

Blackstone additionally half owns Hipgnosis Song Management (HSM), the supervisor of Hipgnosis Songs Fund.

When making its supply, Blackstone additionally warned its funding adviser had an possibility, exercisable at any cut-off date throughout the six-month interval following the termination of its contract, to buy your complete portfolio of songs. 

Both Blackstone and HSM have stated they’ll defend this proper legally, successfully warning towards any try to tear up the administration contract. It is just not clear how Concord will search to cope with the prevailing administration settlement.

Concord has now secured backing from traders holding 31 per cent of the issued share capital of Hipgnosis. Concord additionally stated it meant to promote as much as 30 per cent of Hipgnosis’ property inside a interval of 18 to 24 months following completion of the acquisition.

Concord, which is managed by investor Alchemy Copyrights and is in the end majority-owned by US pension fund Michigan Retirement, has been an acquirer of music rights and corporations.

Concord will present nearly all of the fairness financing, with a minority of fairness in addition to debt from asset supervisor Apollo.

The raised Concord supply represents a rise of about 7.8 per cent on its authentic supply, or 42.6 per cent to the closing value of 71p a share on the final day previous to the bid.