Blackstone Clinches Hipgnosis Deal, Expanding Music Rights Portfolio

Blackstone Inc BX has reached an agreement to acquire Hipgnosis Songs Fund for approximately $1.57 billion, surpassing Apollo Global Management APO backed Concord’s offer in the battle for the music rights owner of artists like Shakira and Red Hot Chili Peppers.

Hipgnosis Songs Fund will be acquired by Lyra Bidco Limited, a newly-formed company indirectly wholly-owned by investment funds advised by affiliates of Blackstone.

Blackstone’s formal bid valued Hipgnosis at $1.30 per share, exceeding Concord’s ~$1.25 per share offer made last Wednesday.

The acquisition will incorporate over 65,000 songs, including compositions by Blondie and Neil Young, into Blackstone’s music rights collection, which already boasts tracks from Justin Bieber and Justin Timberlake, reported Reuters.

The revised offer from Blackstone, the world’s largest private equity firm, came shortly after Concord topped the private equity firm’s initial bid and secured Hipgnosis’s board endorsement. Hipgnosis’s board retracted its support for Concord’s offer.

Blackstone, holding a majority stake in Hipgnosis’ investment adviser HSM, has a call option to present a higher bid for Hipgnosis’s portfolio independently of HSM, despite the association.

Hipgnosis, founded by former CEO Merck Mercuriadis in 2018, commenced a strategic evaluation last year following a contentious period prompted by a shareholder vote against the fund’s continuation, coupled with a disagreement with HSM concerning the call option.

The report further added HSM had cautioned Hipgnosis against terminating the advisory agreement, citing the earlier Concord deal, which involved the U.S.-based company assuming management of Hipgnosis’s assets.

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Price Action: BX shares closed at $122.49 Friday.

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