Round Hill’s UK Fund has spent $342m on acquisitions – and is buying catalogs at a multiple of 16.2x

Josh Gruss

Round Hill’s publicly-traded UK fund has published its first set of interim financial results, for the period ended June 30,  2021.

As of that date, Round Hill Music Royalty Fund Limited (RHM) had invested approximately USD $342 million.

That money went on the acquisition of 38 catalogs, plus the purchase of a 29.1% stake in RH Carlin Holdings LLC.

The publicly-listed UK company acquired the stake in Carlin Music, home to 100,000 song rights including hits made famous by the likes of Elvis Presley, Johnny Cash, Aretha Franklin, and Meatloaf, in May.

The company’s portfolio of copyrights as of June 30 includes 118,000 compositions and 750 master recordings.

Approximately 75% of the compositions are older than 20 years, and include what RHM calls a “rich mixture” of artists, genres, vintages and income composition.

RHM says that its acquisitions were completed at a blended multiple of 16.2x historic annual net revenues.

By way of comparison, Hipgnosis Songs Fund, which is also publicly traded in the UK, revealed a weighted average acquisition multiple of 15.32x in a recent financial update.

You can read RHM’s half-year report in full through here.

The publication of RHM’s results follows the news in July that Round Hill’s publicly-traded UK fund had raised USD $86.5 million in a share placing – exceeding its minimum target of a $50 million raise.

The share issue saw it place 86.5 million C shares in Round Hill Music Royalty Fund Limited (RHM) at $1.00 per share.

RHM’s results also follow a spate of recent acquisitions, including:

  • The music publishing catalog from Yes guitarist and film composer Trevor Rabin on August 11.
  • The master royalty income of Dennis Elliot, the original drummer of rock group Foreigner on September 9.
  • On September 15, The recorded music income and publishing rights to 30 songs from Tim Palmer covering tracks from the Pearl Jam album Ten and Ozzy Osbourne’s album Down to Earth.
  • On September 28, 100% of the master royalty income of 532 original recordings from iconic American classic R&B group, The O’Jays.

“On behalf of the Board, I am pleased to announce the Company’s maiden set of results for the period from incorporation to 30 June 2021.”

Trevor Bowen, Round Hill Music Royalty Fund

Trevor Bowen, Chair of Round Hill Music Royalty Fund, said: “On behalf of the Board, I am pleased to announce the Company’s maiden set of results for the period from incorporation to June, 30 2021.

“The Company has made excellent progress deploying the proceeds of the IPO and completing two further successful capital raises. The Company has generated a 10% Economic NAV Total Return for shareholders since inception.

“We would like to thank our shareholders for their continued support and we look forward to updating shareholders on the Investment Manager’s near term opportunities of income generating acquisitions backed by the royalty rights to timeless music.”

“The Round Hill team is delighted with a highly successful period since IPO.”

Josh Gruss, Round Hill

Josh Gruss, Chairman and CEO of Round Hill, the Company’s investment manager, added: “The Round Hill team is delighted with a highly successful period since IPO.

“During that time we have made great progress in building a world class portfolio including rights to timeless tracks of exceptional quality that are diversified by geography, genre and vintage.

“We are pleased to provide investors with an opportunity to invest in music they know and love whilst generating stable, long term income. We look forward to keeping the market up to date with our latest acquisition opportunities.”

Music Business Worldwide