PopArabia’s Post

My first question here is: Will GMR follow BMI's lead (following its sale earlier in 2024) by setting aside a portion of the sales proceeds for the songwriter and publisher members? My second question is: Why is the private equity market so interested in the U.S. public performance income collection business? Does private equity see inefficiencies and, therefore, opportunities? Starting to wonder how all the private equity $ pouring into the music business in recent years shakes out when we wake up 3-5 years from now... https://lnkd.in/gu3wpNxn

How Sony’s $6bn+ M&A splurge has set the pace for music acquisitions over the past decade MBW Reacts is a series of analytical commentaries from Music Business Worldwide written in response to major recent entertainment events or news stories Sony Music Entertainment #musicbusiness #acquisitions

The potential acquisition of Hipgnosis Songs Fund (HSF) is getting… feisty. The feist-provider in this case being Hipgnosis Song Management (HSM), the investment advisor to HSF, which is run by founder Merck Mercuriadis. To briefly catch you up: last week HSF’s board accepted an acquisition offer from a Concord-controlled entity valuing the company at $1.4bn. Then investment firm Blackstone – the backer of HSM – made a higher offer of $1.5bn. But also: HSM’s investment advisory agreement with HSF includes a clause giving it the right to buy HSF’s portfolio of songs IF the relationship is terminated. Although one way HSF might try to avoid that scenario would be by proving that HSM had failed in its duties as an advisor in some way. Or ways. That brings us to a recent ‘due diligence’ report on Hipgnosis Songs Fundcommissioned by its board, which delivered strong criticism of Hipgnosis Song Management. That included: materially overstating revenue; claiming “greater ownership and administration rights in music assets than the Fund actually held”; financial analysis of acquisitions that was “below music industry standards”; and overpaying for catalogues. Also: that growth of the catalogues HSM actively managed was smaller than those it passively managed; that it “is still not tracking or managing the Hipgnosis Catalog at the song level, which is standard for the music publishing industry”; and excessive expenses including $1.5m-$2m a year on award shows and public relations (“including significant payments to multiple music industry periodicals”). If that all sounds like the kind of failings that would let you terminate an agreement without having to let the advisor buy your catalogues… well, Hipgnosis Song Management is pushing back very firmly on that. Yesterday it published a statement criticising how its role and performance has been portrayed. Read Our Full Analysis Here: https://lnkd.in/ddJ_dTK8 #MusicBusiness #Acquisition #Hipgnosis #musically #musicnews #readmore

Massive news in the music publishing/masters/IP acquisitions world - as Concord Music buys Merck Mercuriadis' Hipgnosis Song Management for $1.4 billion. In a sense, Hipgnosis's logo (seen here) -- with the upside down belly up elephant -- was prescient. Hipgnosis' economics simply never made sense. I've been in this music acquisitions space for a decade now, about as long as any independent player has been. Merck - a great salesperson - upended overall economics when he burst onto the scene in 2018 and seemingly could do no wrong. But the rest of us always scratched our heads about how his numbers penciled out. Always great artists involved, but the deals needed to be great for the artists themselves - and those deals are not just about the money. They are about finding the best "home" for the artist and their music/IP. I work with the artists and their representatives directly to optimize all of that - that is a core part of my business at Creative Media - and my deals have included facilitating some of the greatest icons of the past decades, including Boston, Devo, Count Basie, Prince, Air Supply, Sheila E, Sarah McLachlan, Wailing Souls. There certainly has been much consolidation in this world of music IP, I continue to believe that smart deals can be absolutely great for both the musician sellers and the buyers. Music consumption continues to grow significantly year-over-year -- and there is no end in sight, nor will there be as platform opportunities continue to expand. The key is for there to be smart deals - not just closing deals. That is the lesson of #Hipgnosis. https://lnkd.in/gJKF7T7Y #music #media #entertainment #concord #concordmusic

Here's 3️⃣ reasons why this transition won't be easy for majors OR distributors. At least without some significant pain....😣 1. Majors have an immense cost base built around a model of copyright ownership and 80%+ royalties. When you meet in the middle you simply cannot carry all those people. 2. Distributors play a low margin, low touch volume game. It is tough to pivot and deliver a hands on value add to artists when you have to sustain thousands or potentially millions of tiny acts who don't stream. 3. Neither side will be ALL IN on a single business model. When you aren't focused, in my experience, you tend to fail. The best businesses are simple. This is a genuine opportunity for specialist, agile, independent labels offering fair terms and a proper value add to artists to thrive and scale. Exciting times for those who embrace the clear gap in the market. #musicbusiness #businessmodels #marketopportunities #differentiation #focus https://lnkd.in/eP8wBE7w

Around the world, there are incumbant PROs, each of whom has costs asociated with admin, resources, employees, etc. A big part of that is tied up in collecting royalties from offline rather than digital sources. How does that picture change as digital becomes the majority of the publishing indusry's earnings? #MusicPublishing #MusicRights #MusicRoyalties #MusicBusiness #TuneRegistry

This morning the music rights fund Hipgnosis announced that it will recommend Blackstone’s competing $1.5bn proposal of $1.24 per share, above the $1.16 offer from Concord. Could Concord come back with a higher offer? It’s worth noting that back in October Concord took over the UK-listed Round Hill Music Royalty Fund at 20.6X revenues and a 68.5% premium to the unaffected share price. Blackstone’s offer for Hipgnosis is at 16.4X revenues and a 41.7% premium. However, Blackstone says that Hipgnosis's investment manager Hipgnosis Song Management (a Blackstone portfolio company) has an option to acquire Hipgnosis's catalogue should its management agreement be terminated. Blackstone's statement that it "will vigorously defend" its rights suggests that any bidding war could be accompanied by a lengthy legal battle. #manda #londonstockexchange #mergersandacquisitions

🎶 Exciting News in the Music Industry! 🎵 I'm thrilled to share the latest developments in the music world as BMI, the renowned performing rights organization, is set to be acquired by a shareholder group led by private equity company New Mountain Capital. The deal, anticipated to be finalized by the end of March 2024 pending regulatory and shareholder approval, has a speculated sale price ranging from 1.3 to 1.5 billion dollars. BMI, responsible for collecting royalties on behalf of songwriters and publishers for public performances, is at the forefront of a transformative journey. As part of this acquisition, New Mountain Capital has committed $100 million to be allocated to songwriter and publisher affiliates, recognizing and celebrating their creativity. BMI's announcement emphasizes that while this allocation is not a distribution of royalties, it aligns with the company's distribution methodologies based on performance levels over a set period. Pete Masucci, Managing Director of New Mountain, expresses privilege in working with BMI and its 4 million affiliates, aiming to build on the company's incredible legacy. Notably, amidst concerns from publishers and songwriters regarding BMI transitioning to a for-profit organization, BMI has announced a reduction in the annual royalty distribution from 90% to 85% of collected amounts. New Mountain Capital's growth investment plan for BMI includes three core tenets: increasing cash distributions to affiliates, investing in new technologies, and exploring additional revenue streams. Mike Oshinsky, Director at New Mountain, envisions a modernized music infrastructure, ensuring long-term royalty growth for creators. The company's unique approach combines an open-door policy for all music creators with the innovation and commercial drive of a for-profit business. As the music industry eagerly awaits these transformations, only time will reveal the extent to which New Mountain Capital achieves its ambitious goals. Stay tuned for the next chapter in BMI's journey and the evolving landscape of music royalties! 🎼🚀 #musicindustrynews #BMI #NewMountainCapital #InnovationInMusic https://lnkd.in/g9BKvQye

As we all remember, Believe struck an initial deal with Doğan Music Company (DMC), one of the biggest label in 2020 to acquire a 60% majority stake in the label for €18.8 million. According to a new update, Believe has now reached an agreement with Doğan Group to exercise a call option, acquiring the remaining 40% of DMC for a total of €38.3 million (approx USD $41.8m at current exchange rates). 📌 Believe founder and CEO, Denis Ladegaillerie said that Believe is planning to spend EUR €200 to €300 million per year on acquisitions to grow its global business. 📌 As the the third largest player in Germany; the largest player in India; the third largest player in Japan, Believe wants to continue making very qualitative, targeted acquisitions across [smaller] markets. #music #müzik #türkiye #turkey #musicindustry #musicbusiness #believe #dmc #acquisition

Get educated on the benefits of securitizing music copyrights👉🏼