Hipgnosis Songs Fund buys huge catalog from Kobalt in $ 322.9 million acquisition

Hipgnosis Songs Fund just completed their biggest deal to date.

Hipgnosis, a UK listed company, confirmed today (November 2) that it has acquired over 33,000 songs / song clippings from Kobalt Music Copyrights S..rl, for a total consideration of 322.9 million of dollars.

This is the largest full-featured acquisition announced in music publishing since Concord acquired Imagem for more than $ 550 million in the summer of 2017, although the deal involved an entire music company, rather than a catalog of Copyright.

Hipgnosis’s Kobalt deal is bigger than more recent giant buyouts in music publishing, including Round Hill Music’s acquisition of Carlin Music for $ 245 million in early 2018.

It is obviously important to determine precisely what is in the acquisition of Kobalt.

Kobalt Capital Ltd operates separately with Kobalt Music Group Ltd, the headquarters of Kobalt Music Publishing, Kobalt Neighboring Rights and AWAL.

Kobalt Capital, in turn, manages the acquisition of copyrights on behalf of different funds, each of these funds being backed by institutional investors.

Hipgnosis acquired the portfolio owned by Kobalt Capital’s first fund, launched in 2011. It includes 42 catalogs written by more than 1,500 songwriters from different genres.

This portfolio generated $ 18 million in 2019, up 6% year on year.

Hipgnosis confirmed that the $ 322.9 million paid for the deal represents a mixed acquisition multiple of 18.3X of the catalog’s historical annual revenue.

The deal includes catalogs from bestselling authors such as Lindsey Buckingham, Steve Winwood, B-52s, 50 Cent, Savan Kotecha, Skrillex, Nelly, Bonnie McKee, George Benson, Christina Perri and Walter Afanasieff (including the cut by Afanasieff on Mariah Carey All I want for Christmas is you which broke the all-time record on Spotify for the 24 Hours of Global Game play during the holiday season last year).

The portfolio also includes 18,000 songs from the Nettwerk music publishing catalog, which Kobalt Capital acquired in 2016.

(To clarify: the Hipgnosis deal does not include the SONGS publishing catalog, which Kobalt Capital acquired for $ 160 million in late 2017 using its second fund, through which it raised $ 600 million.)

The list of hits covered by the first catalog of the Kobalt Capital fund, which now belongs to Hipgnosis, includes:

• Follow your own path and Chain by Fleetwood Mac;
• All i want for christmas is you and A sweet day (with Boyz II Men) by Mariah Carey;
• Dancing and hero by Enrique Iglesias;
• Stronger love by Steve Winwood;
• Roar and Teenage dream by Katy Perry;
• give me Love by the Spencer Davis group;
• I can’t find my way home by Blind Faith;
• Never give up on a good thing by George Benson;
• Rotten to the core by George Thorogood;
• Halo by Beyonc;
• Love shack by the B-52s;
• In the club by 50 Cent;
• sorry by Justin Bieber;
• Do not worry Baby by Swedish House Mafia;
• Hot in Herre by Nelly;
• Sugar by Maroon 5;
• Let it go by Demi Lovato (from the Disney Frozen soundtrack)

Following the acquisition, the Hipgnosis Songs Fund portfolio comprises 117 catalogs and 57,000 songs. The company says its post-Kobalt-deal catalog carries an aggregate acquisition value of $ 1.18 billion (roughly $ 1.5 billion).

Merck Mercuriadis, Founder of Hipgnosis Songs Fund Limited and The Family (Music) Limited, said: Hipgnosis has had a special relationship with Kobalt Music since its inception, so it’s only natural that we end up doing a deal like this for the fund. inaugural of Kobalt Capitals. Willard, Johan and Laurent have curated a wonderful portfolio of proven songs which is incomparable with almost anything other than the Hipgnosis Songs catalog which it complements wonderfully. They are both small catalogs with songs of great cultural significance and an incredibly high degree of success within them among the most important songwriters and artists in the rich history of music.

“I am incredibly proud to host iconic songs from Steve Winwood, Lindsey Buckingham, Bonnie McKee, Walter Afanasieff, George Benson, Enrique Iglesias, the B-52, 50 Cent, Christina Perri, George Thorogood, Skrillex, Evan Bogart, J -Kash, Dierks Bentley, Savan Kotecha, LunchMoney Lewis, Eman Kyriakou, John Rich, Simon Neil / Biffy Clyro, Lateral, Mac Powell / Third Day, Mark Batson, David Gray, Tim James and Antonina Armato / Rock Mafia, Stefan Johnson and so many more other amazing songwriters from the Hipgnosis family. They wrote iconic songs for Fleetwood Mac, Steve Winwood, Traffic, Blind Faith, Mariah Carey, Eminem, George Benson, B-52s, 50 Cent, Katy Perry, Beyonc, One Direction, Big & Rich, Maroon 5, Dierks Bentley And so on. much more.

“These special songs that have had such extraordinary success bring the world much more joy and we look forward to working with these phenomenal creators to take their songs to new heights while protecting their legacy. Thanks to Willard, Johan and Laurent and we look forward to working with Kobalt Music as an administrator on this important work.

“Hipgnosis has had a special relationship with Kobalt Music since its inception, so it’s only natural that we end up making a deal like this for Kobalt Capitals’ inaugural fund.

Merck Mercuriadis, Hipgnose

Willard Ahdritz, Founder and Chairman of Kobalt and Chief Investment Officer of Kobalt Capital Limited, said: When we launched KCL in 2010, it was the world’s first regulated music royalty fund, providing clients with our unique and transparent service and giving them the comfort that we could make a long-term commitment to administer their works if they wanted to sell their copyright.

Today, I am happy to say that we have kept our promises to both our clients and our investors. KCL’s advisory board has agreed to sell our first fund to Hipgnosis. The decision to sell to Merck and Hipgnosis was an easy one as we know them so well and the copyrights will be well taken care of under a long term administration agreement with Kobalt Music Group.

“The decision to sell to Merck and Hipgnosis was an easy one because we know them so well and the copyrights will be well taken care of under a long term administration agreement with Kobalt Music Group.”

Willard Ahdritz, Kobalt

Laurent Hubert, CEO of Kobalt Music Group, said: Since 2018 Hipgnosis has been a client and as Merck continues to grow its catalog of songs, one thing will remain constant: Kobalt will continue to provide the best in class publishing administrator. services.

Johan Ahlstrom, CEO of Kobalt Capital Limited, said: We are happy to sell this premium portfolio to Hipgnosis and provide our clients with a great return on their investment in music.

“As the industry continues to grow, KCL will continue to be active in acquisitions and advising all of our funds for our clients and investors.Music company in the world