Hipgnosis strikes new $1.57 billion deal with Blackstone as bidding battle continues

By Louis Goss

Hipgnosis Songs Fund on Monday said it had struck a new deal with Blackstone through which the private equity giant would fully acquire the company that owns the rights to the music of Neil Young and Shakira for an improved sum of GBP1.26 billion ($1.57 billion).

Blackstone's improved offer saw it outbid Nashville headquartered music producer Concord, which upped its own offer to acquire Hipgnosis to $1.5 billion last Thursday having initially offered to pay GBP1.1 billion for the company earlier this month.

In a statement on Monday, Hipgnosis, which was started by guitarist Nile Rogers and his manager Merck Mercuriadis in 2018, called on investors to support Blackstone's takeover, as they withdrew their previous recommendation that shareholders back Concord's bid.

Shares in Hipgnosis Songs Fund UK:SONG increased 2% on Monday having surged 44% in the year-to-date due to excitement surrounding the bidding war that started on April 18.

Hipgnosis shares had previously fallen to all-time lows in March, prior to the announcement of Concord's takeover offer, having lost more than 40% of their value since the company first listed on the London stock exchange in 2018.

Blackstone's new offer represents a 4% premium on Concord's most recent offer and a 48.1% premium on Hipgnosis' share price on April 17, before the Nashvill headquartered music producer made its initial bid.

London listed Hipgnosis, which is currently a member of the FTSE 250 index, has built a business on buying up the rights to hit songs, including those by MF Doom and the Red Hot Chili Peppers, with a view to generating returns through royalties.

Concord, which is being financed by Apollo Global Management, holds the rights to 1.2 million songs, including those by Daft Punk, Pink Floyd, and Genesis.

-Louis Goss

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04-29-24 0430ET

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