Hipgnosis, founded by former Elton John manager Merck Mercuriadis, advises UK-listed Hipgnosis Songs Fund
, which lets investors get a piece of the action in music royalties. The listed group reckons that, in the year to March, its investors made a total return – comprising appreciation in the market value of its right portfolio plus dividends – of nearly 16% in dollar terms. That's more than enough to appeal to a buyout baron.
Other private equity shops are planting flags in the music market, too. KKR earlier this year bought a majority stake in a catalog from OneRepublic artist Ryan Tedder valued at $200 million, according to Reuters. But for Blackstone, the deal with Hipgnosis, in which it will also take a stake, reflects a broader push into digital content across the board.
- Blackstone and Hipgnosis Song Management on Oct. 12 announced a partnership in which Blackstone will provide $1 billion to acquire music rights and manage catalogs. As part of the deal, Blackstone is also taking an undisclosed ownership stake in Hipgnosis, owned by music executive Merck Mercuriadis.
- Hipgnosis is an investment adviser to the UK-listed Hipgnosis Songs Fund, which has around $2 billion in gross assets.Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.
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