Towards the end of last year, MBW ran the now-infamous headline: Here Come The Giants.
It was in reference to three heavy hitters from the investment community – Blackstone, Apollo Global Management, and KKR – deciding to cumulatively funnel billions of dollars into music rights acquisition.
Today (January 14), we learn that another towering name from the finance world – Pimco – is also entering the fray.
The FT cites sources suggesting that Pimco x BMG will seek out smaller deals than those being struck by KKR x BMG.
Yet MBW hears from senior industry sources that Pimco has also started funding another prominent party in the world of music rights acquisitions, with more details of that player’s activities set to emerge in the coming weeks.
The sheer scale of Pimco is a great vote of confidence for the streaming-driven value of music rights in 2022.
As we reported last year, KKR has a portfolio of assets under its management worth around $234 billion; Apollo Global Management has a portfolio of assets under its management worth around $455 billion; and Blackstone has a portfolio of assets under its management worth $649 billion.
By contrast, US-headquartered Pimco currently has a portfolio of assets with a value that dwarves all three of the aforementioned combined: $2.21 TRILLION.
Amongst Pimco’s various investment activities, the firm is a global leader in actively managed bond funds. That may be of particular interest to the music industry right now.
Last month, Private equity company Northleaf Capital announced that it’s raising $303.8 million by selling Asset-Backed Securities (ABS) that are supported by music rights – including songs created by Pete Townshend for The Who, and by country star Tim McGraw.
According to Bloomberg, these securities will be supported by both publishing and sound recording rights, as well as other income streams, across a total of 52,729 songs.
Toronto-based Northleaf took ownership of an interest in certain music catalogs at Spirit in October in a $500 million deal.
MBW estimates – based on confirmed prices and information from industry sources – that at least $5.05 billion was spent on catalog and music rights acquisitions across the 60-plus big-money deals we reported on during last year.
That figure includes deals for individual catalogs sold by artists and songwriters, plus acquisitions of music rights portfolios (including those owned by active labels/publishers) by companies from other companies.Music Business Worldwide