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A KKR-led investor group are closing in on a deal to purchase a tune catalogue spanning hits from Lorde and The Weeknd for $1.1bn, the most recent signal a personal equity-fuelled land rush for music hits is gaining tempo.
Indie music firm Kobalt is in superior talks to promote {the catalogue} to a consortium led by KKR, which is able to take a majority stake, and the household workplace of Stephen Hendel, a former Goldman Sachs accomplice, based on individuals acquainted with the talks.
Negotiations have been superior and a deal may very well be introduced as quickly as this week, these individuals stated. {The catalogue} had additionally attracted bids from an Apollo-backed consortium and Todd Boehly’s Eldridge Industries.
The deal comes as non-public fairness teams have invested billions within the music business, as they seek for locations to allocate capital in an ultra-low rate of interest atmosphere.
The years-long frenzy has solely accelerated in current weeks: Blackstone on Tuesday revealed it might again a contemporary $1bn fund to purchase music rights with Hipgnosis and Apollo introduced a $1bn fund with former Morgan Stanley banker Sherrese Soares final week.
Non-public fairness teams, specialist consumers resembling Hipgnosis, and huge music labels have battled for the catalogues of established artists, whose music has loved a brand new lease on life because of streaming. The competitors has lifted valuations, successfully doubling costs over the previous decade as artists together with Bob Dylan and Stevie Nicks money in.
KKR earlier this yr stated it might staff up with BMG, one of many world’s largest music firms, to focus on acquisitions of music labels and catalogues. Hartwig Masuch, BMG chief government, instructed the Monetary Instances that KKR would supply the monetary firepower for BMG to compete for the very best property.
The corporate additionally this yr agreed to purchase a majority stake within the catalogue of songwriter Ryan Tedder.
KKR and Hendel declined to remark. Billboard reported final week that KKR was a potential purchaser for Kobalt’s catalogue.
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