Welcome to Music Business Worldwide’s weekly round-up – where we make sure you caught the five biggest stories to hit our headlines over the past seven days. MBW’s round-up is supported by Centtrip, which helps over 500 of the world’s best-selling artists maximise their income and reduce their touring costs.
This week, we learned that Neil Jacobson – the ex-President of Geffen Records who exited the UMG label in 2019 to establish his own songwriter/producer management firm – is plotting a major flotation of a new rights company.
Meanwhile, Hipgnosis Song Fund Limited is selling up to 1.5 billion shares to buy more music over the course of the next year. At the published price of Hipgnosis’ ordinary shares (GBP £1.21 per share), a 1.5 billion share issuance would raise over USD $2 billion.
Elsewhere, three of the world’s biggest music companies outside of the major labels – BMG, Beggars Group, and Hipgnosis – each called for dramatic changes to the streaming landscape in their submissions to the DCMS Select Committee’s inquiry on the Economics of Music Streaming.
Plus, Live Nation Entertainment has acquired a majority stake in Los Angeles-based live stream platform Veeps, while Bob Dylan has been sued by the estate of songwriter Jacques Levy for a cut of the proceeds from the sale of his catalog to Universal Music Group.
That IPO saw Mercuriadis raise over £200m (approx $265m) via share issues before Hipgnosis started trading on the LSE. That money set Mercuriadis and Hipgnosis on their way to becoming the most frequently acquisitive company in the modern industry.
Although Hipgnosis’s blistering growth since then has recently attracted one or two skeptics in the financial world, its early investors will be happy bunnies: Since that flotation in June 2018, the company’s share price (to January 15, 2021) has increased by over 16%… despite the small matter of a global pandemic.
Now, Music Business Worldwide can reveal that another music industry figure is plotting a major flotation of a new rights company. It’s happening in the US, and is borrowing a few of the hallmarks of Hipgnosis’s story.
Hipgnosis Songs Fund is raising big money again.
According to a prospectus issued to the markets yesterday (January 21) and reviewed by MBW, the UK-listed company has proposed the issuance of up to 1.5 billion shares – across an initial issue of ordinary shares, and then further placing programs of new ordinary shares and/or C class shares – over the course of the next 12 months.
At the current price of Hipgnosis’ ordinary shares (GBP £1.21 per share), a 1.5 billion share issuance would raise over USD $2 billion.
In the first instance, says Hipgnosis, it will issue a maximum of 500 million ordinary shares at a price of £1.21 each, with potential gross proceeds of up to £605 million (around $830 million).
It hasn’t announced a specific target for the amount of money it wishes to raise with that initial issuance, which is an unusual – but not unprecedented – approach from the company…
3. BMG, BEGGARS GROUP AND HIPGNOSIS EACH HAVE STRONG OPINIONS ON STREAMING. HERE ARE THOSE OPINIONS.
You can just picture it, can’t you?
He gets up this morning, after a strong night on the Glenfiddichs, tongue like sandpaper and little bags of soot under his eyes. He stomps downstairs to the kitchen, flicks on the Nespresso, and sighs.
In his peripheral, an austere tower of joyless A4 – nearly 200 multi-page submissions to the DCMS Select Committee’s inquiry on the Economics of Music Streaming, rippled through with complex, contradictory, uncompromising prose. And jargon; so, so much jargon.
“Urgh,” he thinks to himself. “How in all that is holy did I get involved in this monstrous heap of sh**e? They told me I might get to meet Sting! Now look where we are.”.
Or maybe not. Either way, those 197 individual submissions – each setting out a unique argument for how UK lawmakers should change (or not change) what and how streaming pays music rightsholders – were made public today online…
Platforms offering ticketed live streams became a much-needed source of income in 2020 for artists unable to play concerts due to the global pandemic.
One such platform is Los Angeles-based Veeps, which was established in 2017 by Joel and Benji Madden of the band Good Charlotte.
According to Joel Madden, in 2020 alone, Veeps live streams “helped artists — both big names and new acts — make over $10 million for themselves, their families, their crew and their chosen causes”.
On Tuesday (January 19), we learned that Live Nation Entertainment has acquired a majority stake in the company for an undisclosed sum.
Benji and Joel Madden, alongside co-founders Sherry Saeedi and Kyle Heller, will remain at the helm of Veeps, with their full team staying on to continue with all operations of the business…
Bob Dylan was hit by a lawsuit by the estate of songwriter Jacques Levy on Wednesday (January 20) demanding a cut of the proceeds from the sale of his catalog to Universal Music Group last month.
The buyout, conducted via Universal Music Publishing Group (UMPG), included more than 600 copyrights spanning 60 years, from 1962’s Blowin’ In The Wind all the way to Dylan’s 2020 release, Murder Most Foul.
Universal did not disclose the price of the deal, but expert industry sources told MBW in December that Dylan’s catalog would command a price-tag somewhere in the region of $300m to $400m.
UMG is also named in the suit…
MBW’s weekly round-up is exclusively supported by Centtrip, leading provider of smart treasury, foreign exchange and payment solutions for the music industry. Find out more here. Music Business Worldwide