acquisitions
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BMI’s October 2022 switch to operating as a for-profit company didn’t cause a big reaction in the music business until a July 2023 Reuters article about the company being put up for sale revealed that it had generated $147 million in earnings before interest, taxes, depreciation and amortization. Then the response was significant – and mostly negative. The fear was that profit would essentially come at the expense of royalty payouts.
Even so, BMI executives and other music business sources familiar with the way private equity funds think about business suggest that songwriters and executives should wait to see how the performance rights organization’s vision, backed by the right strategic partner — such as New Mountain Capital, with which BMI is negotiating — could help them.
BMI has said it is switching models and seeking a buyer in order to respond to a changing market. “We need to continue to invest in our business and explore new avenues for revenue generation,” CEO Mike O’Neill said in an Aug. 18 letter to creators groups that was shared with Billboard, “so we can continue to expand our distribution sources.”
To do that, while delivering the kind of growth a buyer will presumably want, BMI plans to explore new businesses to build a company that can operate at scale, and across national borders, more efficiently than it now does. The idea, according to sources inside and familiar with BMI, is to create a new interdependent royalty-collection ecosystem that will benefit BMI and its potential new owner, as well as its affiliates.
BMI is looking for “a partner who can help us take advantage of new opportunities and provide a new level of investment and technological expertise,” according to a Sept. 5 letter from O’Neill to creators groups published on BMI’s website. New Mountain Capital, which is in an exclusive period to negotiate a deal with the performance rights organization, could be such a partner, executives familiar with the private equity sector suggest, since the firm has a track record of investing in companies to help them achieve significant growth. Since its 1995 launch, New Mountain — which now oversees more than $35 billion in assets and funds — has acquired or founded more than 60 companies, without any going into bankruptcy and without missing an interest payment, according to the company.
In particular, sources familiar with New Mountain Capital point to its investment in Blue Yonder, a software company the private equity firm acquired for $565 million in 2010 and sold to Panasonic in 2021 for an enterprise value of $8.5 billion. The private equity firm, “through continued investment and improvement” helped grow it from a “somewhat sleepy niche company to being the 14th largest software company in the nation,” New Mountain Capital’s CEO Steve Klinsky wrote in the May-June 2022 issue of Harvard Business Review. “We offer the capabilities and access to capital that a large corporate parent would, without forcing companies to become part of a conglomerate culture. At the same time, we bring a fresh, entrepreneurial vision to strategy, talent, R&D, technology, and corporate alliances.”
Still, BMI has not specifically addressed many of the concerns raised by its switch to a for-profit model, which is why songwriters and publishers remain nervous. In fact, on Sept. 18 a letter signed by dozens of lawyers called on BMI to engage in open and honest conversations with affiliates, saying that the PRO owes them the responsibility to respond with “specificity and transparency.”
“I get it that some writers may have legitimate worries because in a vacuum there is not a clear picture of what such a deal could be and how it could be a positive for BMI,” says a veteran music business executive. “But a lot of people with their own interest have been spreading very negative spins with shrill voices that what BMI is doing will be bad for publishers and songwriters.”
In the case of New Mountain Capital, the executive says, they “are nice, smart people” that help businesses add new processes to help them grow substantially and become even more profitable. New Mountain Capital has been studying the music industry for a few years and looked at some substantial deals, sources say, but so far has passed on them until now.
“There is so much negativity out there that doesn’t give this deal the benefit of the doubt,” says another executive. “New Mountain Capital are not corporate raiders; they are intelligent and love the business and want to grow the revenue base so that publishers and writers will be making more money and still make a profit for BMI.”
That’s exactly the kind of approach BMI is looking for, according to executives familiar with its strategy. In its first year as a for-profit business, for example, BMI announced a partnership with the United Arab Emirates company Music Nation to try to establish a public performance licensing and royalty infrastructure there. BMI has also undertaken an “extensive customer service initiative” to enhance the service it provides to affiliates, with plans for an improved online service portal to follow.
The company has said that its move to a for-profit model made these investments possible. But one music publishing executive, who requested anonymity, wonders “why is it easier to invest in systems upgrades as a for-profit entity rather than as a not-for-profit organization?” One answer: The level of investment would impact distributions to affiliates under the previous not-for-profit system.
Publishing executives also believe that growing outside the U.S. will become a priority for BMI. Most of the growth for royalty collections is now coming from the growth of streaming services, and most of that will be international. Over the past decade, some of the European collective management organizations teamed much with publishers to license repertoire for online purposes across Europe, as European law allows. Such a model could also work in other territories, such as Latin America, Asia, or even the Middle East.
Given the opportunity for BMI outside the U.S., another executive wonders if it could be the first organization to try to rollout a global model, with a global membership. And if so, whether that would re-ignite competition to sign writers around the world.
Meanwhile, some executives speculate about whether New Mountain might be frightened off by the antitrust consent decree under which BMI operates, but “they understand deeply what that means,” says a source familiar with the fund, “and that it is baked into the business.”
Private equity is known for growing profits, not restraining them, but sources familiar with BMI’s thinking say that potential suitors need to understand that the company will prioritize payouts. In fact, a potential deal would not involve an expectation of “insane margins,” says one music industry executive who has worked with private equity. If a sale takes place, said O’Neill in an Aug 19 letter, BMI “would ensure that any partner embraces our mission of prioritizing the interests of songwriters, including their financial success.”
For-profit, for whom?
It’s “easy to assume that if we kept doing business the way we always had, distributions would continue to grow,” O’Neill wrote in his Sept. 5 letter posted on the company’s website. “That is a dangerous assumption to make, because in an evolving industry like ours, you run the risk of settling for a larger slice of a shrinking pie. Our goal is to grow that pie to your benefit.”
So far, in the three quarterly distributions since BMI announced its shift to a for-profit model, combined payouts were 9% greater than the same periods of the previous year. That’s almost as good as the 10.2% increase to $1.471 billion that BMI distributed in the fiscal year ended June 30, 2022, when overall revenue grew 15.6% to $1.573 billion, when it was still operating as a non-profit. (BMI is not releasing how much distributions increased for the full year ended June 30, 2023, and it will no longer release any company-wide revenue results, sources say. Instead, it will provide more information to songwriters and publishers to help them measure BMI’s payments in comparison to the past, and in some cases, if songwriters so request, to other PROs.)
Some songwriters and executives argue that, if BMI is sold, affiliates deserve some of the revenue from that sale. But as one industry executive familiar with private equity points out, it’s actually surprising that BMI’s owners – radio and television stations – didn’t sell it a long time ago.
“For over 80 years, you have had owners — all for-profit companies with their own businesses — and yet they didn’t make any profit on BMI,” that executive says. “And I guess it would be unseemly for them to pull dividends out at the same time they are paying licensing fees.” At the same time, he adds, those owners had to watch SESAC and GMR come along and build very profitable businesses.
SESAC, which is considerably smaller than BMI, was sold to the private equity firm Blackstone for about $1 billion in 2017. Ironically, at the end of 2018, one of Blackstone’s investment funds acquired a passive minority equity stake in New Mountain Capital, a fact that U.S. regulators could look at, if New Mountain Capital moves forward with its BMI acquisition.
“The fact is that the broadcasters own BMI; and they are entitled to sell it,” the executive says. “I understand that the music industry likes the status quo, but if you start with the premise that the owners will sell, then you would want them to sell it to someone who is decent and understands the industry. It’s not smart to push [New Mountain Capital] away with a big outcry, because you don’t know who will come along next.”
There is also the potential for BMI to grow into a more modern company in a way that benefits the entire industry, the source says. “Take a year or two and see how things roll forward and how things shake out. If [BMI] songwriters are happy, then they can stay; and if not, then they can look to make a move.”
Concord’s $469 million bid for Round Hill Music Royalty Fund, announced on Friday, did more than give Round Hill’s shareholders a tidy premium over the previous day’s closing price. The offer, which must be approved by 75% of Round Hill shareholders at the company’s Oct. 18 general meeting, also provides a vote of confidence in music asset valuations and the ability of the marketplace to seek out value.
Andy Moats, director of music, sports and entertainment at Pinnacle Financial Partners, says Concord’s offer is “a win-win for all parties.” Round Hill, which had been trading at a steep discount to its catalog’s value, was offered a premium over the share price prior to the announcement. Concord gets to pay fair-market value for a catalog of 150,000 songs by the likes of Bruno Mars, The Supremes and Louis Armstrong.
The deal comes as Round Hill’s share price struggled to meet expectations and falls short of it the value ascribed by multiple independent experts. Concord bid $1.15 per share, 11.5% below the per-share net asset value (NAV) ascribed to Round Hill by Citron Cooperman, a leading valuation expert. Round Hill’s shares had been trading at a 47% discount to NAV the prior day and had fallen 11.5% year to date.
But the fact that Concord’s bid is slightly below Round Hill’s NAV shouldn’t be viewed as a negative, says Larry Miller, clinical professor and director of music business program at New York University. “When you see a liquidity event like this at even close to NAV, I think that is a sign of a strong business fundamentals, notwithstanding how some class of investors — in particular investors in alternative assets — might view the value of the catalog to NAV.”
Moats agrees that Concord’s bid should be seen as a positive despite falling short of Round Hill’s recent NAV. “It was consistent with what we’ve seen in the past” in terms of where deals transact, he says. Not all deals close precisely on valuations, Moats says. Some prices are above valuations and some fall below. The Round Hill price is “within range of what I’ve seen over the last five years where something trades relative to its valuation,” he says.
Other people see additional positives in Concord’s bid for Round Hill’s music royalty fund — which still leaves Round Hill with a substantial publishing and recorded music business. To some, the acquisition reflects a functioning market in which Round Hill’s music assets are moving to Concord’s more efficient cost structure.
Roy Salter, senior managing partner at Virtu Global Advisors, says the deal shows the market is working as intended. “Among the major messages symbolized by the Concord transaction is the continuing advancement of music royalty capital market efficiencies, wherein an increasing number of pension and profit-sharing funds, insurance companies, sovereign funds and similar capital market constituents are steadily entering the market in search of predictable, non-correlated investment returns, and business operations which support music royalty administration continue to be enhanced such as enables optimal market-efficiencies,” he says.
For others, Concord’s bid is an important vote of confidence for firms’ NAV models. “The key takeaway from this Round Hill deal is that it affirms the valuation methodologies that have been used for large music portfolios,” says Michael Poster, an attorney with Michelman & Robinson. “For all the negativity that has come out of a handful of analysts around some of these valuation methodologies, at the end of the day, the market tells the story.”
NAV, a measure of an investment fund’s assets minus debts and liabilities, has been a sticking point for Round Hill and the other publicly traded music royalty fund, Hipgnosis Songs Fund, in recent years. Citron Cooperman, FTI Consulting and other valuation experts employ valuation models that calculate music catalogs’ values by estimating their cash flows over a lengthy period of time. A company’s NAV can improve if the valuation expert believes the catalog merits a lower discount rate, for example, or because favorable industry trends suggest previous revenue forecasts are too conservative.
Some equity analysts have raised questions about not just the valuations but the music industry’s tendency to constantly update NAV. Most funds in other sectors hold their new acquired assets at cost “until there are verifiable reasons” — such as a market transaction — “to suggest a change is warranted,” Stiefel analysts wrote in a Jan. 7, 2021, note to Hipgnosis investors.
Over the last roughly two years, a gap between independent valuation expert’s NAV and Round Hill’s trading price had widened dramatically. The discount to NAV stood at 5% on Dec. 31, 2021, when Round Hill’s NAV was $1.12 per share, and peaked at 51.6% on April 3, 2023, when Round Hill fell to $0.615 per share.
To give the market more faith in its NAV, Round Hill commissioned a second valuation report, by FTI Consulting, that put its NAV within 3% of Citron Cooperman’s estimate. This additional valuation supported Round Hill’s view that its portfolio was being “significantly undervalued” by investors, Round Hill CEO Josh Gruss said at the time.
The move appears to have helped some: Round Hill’s share price rose 19.7% over the following month (Hipgnosis shares, not part of Round Hill’s efforts to change investors’ impressions, fell 4% over that period). But whether investors remained concerned with NAV methodologies or motivated by rising interest rates and other macroeconomic factors, Round Hill’s share price remained well below NAV until last week.
Concord’s bid also provided a boost to Hipgnosis Songs Fund shares that have also been trading at a deep discount to NAV. The day before Concord’s bid was announced, Hipgnsosis shares closed at 0.798 pounds ($1.00), a 58.3% discount to the company’s NAV on March 31 of $1.92. Whether investors regained faith in the NAV or expect Hipgnosis to negotiate a similar asset sale, its shares jumped 15.7% to 0.923 pounds ($1.15) the day of the announcement, peaked at 0.962 pounds ($1.20) on Tuesday and closed at 0.93 pounds ($1.16) on Wednesday.
Had Concord’s bid come in significantly less than NAV, there could have been ripple effects that touched everybody from banks to investors. In such a scenario, people would re-think the value of catalogs and their interest in investing in music assets.
But that didn’t happen. Concord and Round Hill, both widely considered to be smart players in the music asset market, agreed to a price tag close to the often-criticized NAV. If the market was looking for a signal about how to value Round Hill, it received a credible confirmation.
“There’s a lot of stability and consistency in this space,” says Moats, “and this transaction provides that.”
Digital distributor DistroKid has acquired Bandzoogle, a platform specializing in helping artists create websites and sell their wares to fans. Launched in 2003 and based in Ottawa, Canada, Bandzoogle powers more than 60,000 artist websites and e-commerce stores, and provides solutions for crowdfunding, subscriptions and mailing lists. “At DistroKid, we’re always working on innovative ways […]
Exceleration Music, the independent music company that has invested in and acquired numerous indie labels over the past several years, has acquired global digital and physical distribution and music services company Redeye, it was announced Friday (Sept. 8).
The deal not only marks Exceleration’s biggest acquisition to date but an expansion into distribution and services, effectively creating an entirely new division at the company — albeit one that will continue to operate under the Redeye name. Under the agreement, Redeye founders Glenn Dicker and Tor Hansen will continue to lead the company, retaining its existing staff and infrastructure while taking advantage of the resources and expertise offered by the Exceleration partners and team.
“We looked at what was happening with the distribution landscape, [which was seeing] a lot of consolidation,” Exceleration co-founder Glen Barros tells Billboard. “You know, you have each of the majors buying up indie distributors, and we thought it would be good to really preserve and strengthen a great indie option and make sure that indie labels have a fully independent path to market.”
The deal also includes Redeye’s in-house labels, Yep Roc and Sundazed, along with its publishing company, Riff City Sounds. Yep Roc’s roster includes Nick Lowe, Dave Alvin, Aoife O’Donovan, Alejandro Escovedo, Chuck Prophet and Jobi Riccio. Sundazed is a reissue label based in the United States.
Redeye — which signed a distribution deal with Exceleration in May — represents some of the world’s most prominent independent labels, including Beggars Group, Domino, New West, Saddle Creek, Mom+Pop, Kemado/Mexican Summer, Stones Throw, Warp, Drag City, Real Gone, Innovative Leisure, Carpark, !K7, Thrill Jockey, Luaka Bop, Partisan, Sargent House, Ninja Tune, Barsuk and Daptone.
Founded in 1996 by Hansen and Dicker, the distributor is headquartered in Hillsborough, N.C., and boasts more than 120 employees spread across 15 locations in the United States, Canada, Europe, the United Kingdom and Australia. Prior to the acquisition, it was wholly owned and operated by Dicker, Hansen and their team. In 2019, the company merged with Sweden-based distributor Border Music to expand its distribution operation in Europe.
In addition to Hansen and Dicker, Redeye’s leadership structure will remain in place following the acquisition. The list of high-level executives at the company includes Michael Petkov, head of international; Jason Taylor, director of global sales (physical and digital); Laura Pittard, director of global marketing; Michael Howard, associate vp of global operations; Hank Stockard, global business development director; Sean Pecor, IT director; and Jim Trenner, global accounting director.
Moving forward, Exceleration will support Redeye’s existing growth plans by providing operational and strategic support as well as capital. “Redeye has done a lot of work over the last few years to expand their worldwide footprint on the physical side, and they’re been a digital distributor for a long time too,” says Exceleration co-founder Dave Hansen. “So we’re going to work with them to continue building that network and offer a real solution for their existing customers, our label group and new customers [as well].”
More than anything, adds Barros, the Redeye acquisition dovetails nicely with Exceleration’s overall mission: to strengthen the independent music community in whatever ways it can. “We really want to serve this community according to what’s important within this community, and [that] is having, I think, an independent vibe,” he says. “It really is looking at the whole sector holistically and saying, ‘How can we really fill the needs of the community and do it in an indie way?’”
Exceleration was founded in 2020 by a group of five prominent independent label executives: Barros (former CEO of Concord Music Group), Hansen (executive chairman of Merlin and former GM of Epitaph), Charles Caldas (former CEO of Merlin), Amy Dietz (former GM of Ingrooves) and John Burk (a Grammy-winning producer and former president of Concord Records). Its music rights group includes investments and partnerships with labels and catalogs including +1 Records, Alligator, Azadi, Bloodshot, Candid, Heroic, Kill Rock Stars, Mom+Pop, SideOneDummy and The Ray Charles Foundation/Tangerine Records. The company currently boasts nearly 30 employees and is currently hiring for two additional positions, including a head of finance. Funding for Exceleration comes from all five of its partners as well as institutional and private investors.
“Working with the Exceleration team feels like expanding the family,” said Dicker in a statement. “Sharing strong ideals and a strategic vision, it feels like the next natural step on our journey towards providing our world class distribution service to an expanded independent community.”
Exceleration Music formed a strategic partnership with Azadi Records, an India-based independent label co-founded in 2017 by Mo Joshi and Uday Kapur. Under the deal, which marks Exceleration’s first in Asia, Exceleration has made a financial investment in the label to help fuel its growth. Azadi will also benefit from access to Exceleration’s worldwide team and infrastructure, with Exceleration partner Charles Caldas joining Azadi’s board to help guide the label’s strategy, performance and development. Azadi Records artists include Indian hip-hop duo Seedhe Maut, producer Sez on the Beat and rapper Prabh Deep, who won a Toto Funds the Arts (TFA) award — a major independent music prize in India. Forthcoming releases on the label include Seedhe Maut’s mixtape Lunch Break, an EP from Ranj & Clifr and a collaborative album from United Kingdom-based rappers Sonnyjim and PAVAN.
Encore Luxury Coach Leasing acquired Nitetrain Coach Company in Whites Creek, Tenn., making it the largest entertainer coach leasing company in North America. The acquisition brings Encore Luxury’s fleet to more than 145 coaches. Under the deal, Encore’s leasing operations will have offices in Phoenix and Nashville, with over 25 maintenance technicians. Touring clients of the combined companies include Nickelback, Thomas Rhett, Bailey Zimmerman, Lauren Daigle, Ben Harper, Barry Manilow, Beck, Phish and Blink-182.
Virgin Hotels partnered with Sofar Sounds for Hear This!, a new monthly concert series that will showcase emerging Sofar artists. The series will be open to the public, with Virgin Hotels’ Know members receiving premier access to reserve tickets ahead of the public onsale. Attendees of the concerts will also have access to exclusive Spotify and Apple Music playlists featuring highlights and recommendations from Hear This! artists. Members of Virgin’s rewards program, Virgin Red, will also be able to redeem Virgin Points to join Sofar Sounds events at Virgin Hotels, including Hear This! Virgin Hotels will also offer preferred room rates to all Sofar Sounds artists to help alleviate the impact of the pandemic on touring artists. Hear This! kicks off on Sunday (Sept. 10) at Virgin Hotel Dallas, with future iterations in Chicago, Dallas, Nashville, New York City, Edinburgh and the recently opened Glasgow location. Get more details here.
One Media iP acquired the licensor’s income share — or the income that is generated from digital exploitation — of the “Entertain Me” catalog of rights, which includes more than 15,000 tracks performed by artists including Dean Martin, Gloria Gaynor, Judy Garland, Ray Charles and Louis Armstrong. The acquisition was undertaken by One Media’s Harmony IP asset release program, “which allows music rights holders advanced access to the future earnings of their intellectual property by purchasing a portion of their rights up front,” according to a press release.
Also at One Media iP, the company renewed its partnership with music distributor The Orchard; the deal includes a $1 million recoupable advance to One Media “to be used to enhance catalogue enrichment,” according to a press release. The advance is recoupable against future sales by One Media.
The Pennsylvania Convention Center Authority (PCCA) board of directors approved a five-year contract renewal for ASM Global as its venue management company. The new agreement commences on Dec. 1, 2023, and runs through Nov. 30, 2028. ASM Global is “planning to bring many of its most innovative designs to a leading group of convention centers beginning with PCCA,” according to a press release.
Allseated, which offers virtual tour technology and floorplan design tools for venues, raised $20 million in funding, including capital from Level Structured Capital (an affiliate of Level Equity) and existing investors Magma Ventures, Vestech Partners, NYFF and WGG. The money will be used to further scale Allseated’s space visualization and collaboration platform and fuel its global expansion. Along with the new funding, the company is spinning out its Meetaverse division; according to a press release, “this includes a brand-new entity with a dedicated mission: to pioneer immersive experiences, such as virtual events and corporate environments, within an emerging market landscape.”
Full-service artist management company and record label Red Music Rising, which is managed entirely by Indigenous individuals, struck an exclusive global distribution deal with Warner Music Canada/ADA Canada. The Red Music Rising roster includes Wolf Saga, Boogey The Beat, Logan Staats and Nimkish.
Grant Avenue Studio, a legendary recording studio based in Hamilton, Ont., that has hosted artists including Gordon Lightfoot, Johnny Cash, U2 and Sarah McLachlan, was sold to music and film industry executives Mike Bruce and Marco Mondano. Bruce is a musician who owns and operates film studios, including Aeon Bayfront Studios in Hamilton, while Mondano owns D.C. Music, a rehearsal, recording and live production studio in Toronto. Grant Avenue Studio was established in 1976 by Daniel Lanois and his brother Bob, who later teamed up with engineer Amy King to helm the studio until the spring of 2023. Under its new ownership, new offerings at the studio will include an artist lounge, a writers’ studio, film and photography location opportunities and artist development programs.
Deezer expanded its partnership with leading Latin e-commerce platform Mercado Libre, becoming the official music streaming partner for the company’s new retail and entertainment subscription program, Meli+, which has been introduced in Mercado Libre’s main markets, Brazil and Mexico. The program includes a full year of music streaming from Deezer, among other elements. Brazilian artist Ana Castela has been appointed as the official Deezer ambassador on Meli+ and will star in joint campaigns and promotion.
Symphony, an artificial intelligence-powered marketing operating system for artists, creators, managers and independent labels, closed a $1 million pre-seed fundraising round from investors including Spice Capital, GoldHouse Ventures, LVRN Records, Guin Records, former Motown Records CEO Ethiopia Habtermariam and artists including 21 Savage and 24kGoldn. The SymphonyOS platform uses artificial intelligence to analyze millions of data points in order to create music marketing strategies for artists and labels. Since its beta launch in April 2022, SymphonyOS has processed over $750,000 worth of advertising budgets.
Universal Music Group (UMG) has expanded its presence in the fast-growing Middle East and North Africa (MENA) region with the acquisition of United Arab Emirates-based music company Chabaka, it was announced Wednesday (Aug. 30). Founded in 2013 by brothers Ala’a and Tarek Makki, Chabaka provides digital distribution, marketing, publishing and label services and has deals […]
Kids’ audio platform Yoto, which is behind the screen-free Yoto Player and Yoto Mini, signed an industry-first agreement with Universal Music Group (UMG) to bring music titles and artists from its labels and catalogs to the platform for the first time. Founded by Ben Drury and Filip Denker, Yoto allows children to access music without being exposed to advertising or unsuitable content. The UMG partnership kicked off this month with the launch of Queen’s Greatest Hits: Volume 1 as a “Yoto Card.” That will be followed in the coming months by releases from artists like Bob Marley & the Wailers and labels including Motown Records and Disney Music Group. The Queen cards will be available on Yoto webstores in the United States, United Kingdom, Canada and the European Union; Yoto Amazon stores in the United States, United Kingdom and Canada; and the Queen online store.
Round Hill Music acquired Linus Entertainment, the Canadian independent music company that includes the recording and publishing catalogs of Borealis Records, Mummy Dust Music, Solid Gold Records, Stony Plain Records, The Children’s Group and True North Records, as well as the distribution company Independent Digital Licensing Agency Inc (IDLA). The acquisition encompasses over 3,000 songs and more than 20,000 master recordings. It includes recordings from Buffy Sainte-Marie, Gordon Lightfoot and Taj Mahal, among many others.
Reservoir Media and PopArabia jointly acquired the catalog of Cairo-based content production and distribution company RE Media, encompassing sub-labels Moseeqa and Moseeqa TV and several of RE Media’s owned and operated YouTube channels. The acquisition includes more than 6,000 recordings and compositions from artists such as Amr Diab, George Wassouf, Dalida and Mohamed Mounir. Reservoir and PopArabia additionally acquired the master and publishing rights for the catalog of Egyptian rap duo El Sawareekh.
Timbaland acquired a stake in lifestyle and vinyl brand 12on12, where he will serve as a strategic partner and curator. According to a press release, 12on12 allows “cultural icons” to curate soundtracks of 12 songs “that have inspired, affected and influenced them,” which are then pressed on 12″ vinyl. Timbaland is currently working on his own 12on12 release that will drop at the beginning of next year. His Verzuz partner Swizz Beatz previously acquired a stake in the company in February 2022; since then, 12on12 has expanded into releasing limited edition fine art prints and lifestyle pieces featuring co-curators’ artwork. The company has already collaborated with Run DMC, Swizz Beatz and Travis Scott x Saint Laurent, among others.
Apple Podcasts added several new hosting providers that will support Delegated Delivery, which allows creators to publish subscriber episodes directly from their participating hosting provider dashboard. The new partners are Audiomeans, Captivate, Podbean, Podspace and Transistor, all of which will support Delegated Delivery by the end of 2023. Elsewhere, the company revealed an exclusive integration with Linkfire, which is expanding into podcasting this fall with a toolkit built specifically for podcasters. Using that toolkit, podcasters on Apple Podcasts will have the ability to generate an unlimited number of smart links with landing pages for their podcasts and measure how listeners engage with them using the Linkfire Insights dashboard.
The Salzburg Festival is making its operas, orchestral concerts, lieder recitals and chamber music exclusively available on the recently launched Apple Music Classical streaming platform. More than 100 such recordings are already available at launch.
Matthew Berry‘s fantasy sports and sports betting media company FantasyLife closed a $2 million dollar friends and family round from investors including John Legend, YouTube co-founder/former CEO Chad Hurley and Wasserman Media Group chairman/CEO Casey Wasserman, among many others. Hurley, Wasserman and The SpringHill Company co-founder/CEO Maverick Carter (also an investor, with LeBron James’ LRMR Ventures) will also join the FantasyLife advisory board. Fantasy Life additionally announced new partnerships with brands including Epic Seats, Webex by Cisco and Buffalo Wild Wings.
Believe‘s global dance and electronic imprint b:electronic signed Berlin-based house and techno label mobilee records and Feathers & Bones, the new label from electronic artist Rodriguez Jr.
The Bruce Springsteen Archives and Center for American Music at Monmouth University and E Street Band guitarist Steve Van Zandt’s TeachRock education program announced they would team up to help teachers bring American popular music into the curriculums of classrooms across the United States. Future collaborations will include teacher workshops, student internships, seminars and conferences, curriculum development and joint research activities. The efforts between the two organizations will begin at Asbury Park Middle School and High Schools in New Jersey with the Harmony Student Wellness Program, which uses “popular music as a springboard” for lessons around self-awareness, self-management, relationship skills, responsible decision-making and social awareness, according to the TeachRock website.
Absolute Label Services partnered with Prestige Management for the release of Busted’s forthcoming Greatest Hits 2.0 compilation. Absolute will provide a range of services for the release, including distribution, marketing and project management. The album compiles newly-recorded versions of all of Busted’s biggest hits, fan favorites and live staples, with deluxe formats featuring a number of previously unreleased collaborations with artists including McFly, James Arthur, You Me At Six, The Vamps, Bowling For Soup, Dashboard Confessional, Deaf Havana, Wheatus and Charlotte Sands.
BMI has accepted an offer to sell to New Mountain Capital, a private equity firm that has been quietly looking at music assets over the last few years, according to sources. It’s unclear if the deal has been signed yet.
Sources suggest that New Mountain Capital will pay about $1.7 billion for BMI which claims $145 million in earnings before interest, taxes, depreciation and amortization in its first year acting as a for-profit entity, which was announced last October. That suggests that BMI — aka Broadcast Music Inc. — is trading on a nearly 12 times EBITDA multiple. Since BMI has no debt, it’s likely that New Mountain Capital will use a healthy level of debt to finance the deal.
According to New Mountain Capital’s website, the firm has $40 billion in assets under management and chases a “growth-oriented, value-add investment approach, rather than reliance on excessive risk, as the best path to high and consistent long-term returns.” The firm has made investments in such industries as software, business services, information and data, logistics and financial services among a few other sectors.
Besides New Mountain, sources say, bidders included Apollo Global Management, Brookfield Asset Management and its music investment Primary Wave, and RedBird Capital Partners. New Mountain and Brookfield/Primary Wave became the finalist, until BMI accepted New Mountain’s offer. Moreover, sources add that Moelis & Co. has been acting as an advisor to New Mountain while BMI has acknowledged that it hired Goldman Sachs to explore a strategic partnership.
BMI first put itself up for sale last year and at the time said it was switching from a not-for-profit operation to a for-profit company. In its fiscal 2022, before it switched to a for-profit entity, BMI reported that it collected $1.573 billion, while distributions totaled $1.471 billion. While the company has stated that the move is being made to benefit its affiliates and will allow the company to spend more money on developing technology and infrastructure so it can better services and songwriters, the strategy shift has caused consternation among songwriters and publishers.
Last week, a group of songwriters and creative advocates wrote a letter to BMI asking how such a move would benefit songwriters and questioning whether the profit would come at the expense of songwriter payments. The groups that signed the letter were Black Music Artists Coalition; Music Artists Coalition; Songwriters of North America; SAG-Aftra and Artists Rights Alliance.
Since its formation in 1940, BMI has been operating as a not-for-profit organization, paying out all of the money it collects to songwriters and publishers, even though it was a private company. In response to the songwriter and creator organization letter, BMI president Mike O’Neill said that because of its first year acting as a for-profit entity, it has allowed the company to upgrade its services portal, including new dashboards, among several other initiatives. He also said in pursuing a BMI sale, the company “would ensure that any partner embraces our mission of prioritizing the interests of songwriters, including their financial success.
BMI declined to comment for this story, and other firms mentioned didn’t immediately respond to a request for comment or couldn’t be reached.
Round Hill Music has acquired the remaining share of Big Loud Shirt’s catalog of music publishing rights, bringing Round Hill Music’s ownership of Big Loud Shirt’s music catalog to 100%. Round Hill previously acquired a share of the Big Loud Shirt catalog in 2014.
Round Hill has also acquired 50% of the writer’s income streams from songwriter/producer Craig Wiseman, the founder/owner of Big Loud Shirt.
The Big Loud Shirt catalog comprises more than 1,200 songs recorded by artists including Blake Shelton, Dierks Bentley, Carrie Underwood, Faith Hill, Luke Bryan and Tim McGraw. The majority date prior to 2015, with 75% of them at least seven years old.
According to a press release announcing the deal, streaming income generated from Big Loud Shirt’s catalog increased approximately 200% from 2017 to 2021.
The deal brings new rights into Round Hill’s portfolio and expands its existing interests in songs including McGraw’s “Live Like You Were Dying” (co-written by Wiseman), Underwood’s “Before He Cheats” and “Blown Away” and Strait’s “I Saw God Today.”
According to a release, this acquisition also increases Round Hill’s exposure to the country music market, which as of December 31, 2022, comprised 11% of their portfolio.
Round Hill Music CEO Josh Gruss said in a statement, “Craig Wiseman and his publishing company, Big Loud Shirt, have produced some of the highest profile, most recognizable and enduring country music hits of the last three decades, bringing them firmly in line with the song profile of the Company’s portfolio. We have a terrific working relationship with Craig, who we have known for many years, and are deeply familiar with these songs. This investment not only enables us to further increase Round Hill Music’s exposure to the fast-growing Country music genre but also provides an exciting opportunity for us to leverage our in-house platform to manage these incredible songs, maximizing their income streams and further growing their value.”
Wiseman added, “I have known and been working with Round Hill for a decade and I’m thrilled to be expanding our relationship by sharing these incredible pieces of art with them. I know they will manage these songs carefully and effectively, identifying creative opportunities to bring them to new audiences worldwide.”
GEMA, the German collective management organization (CMO), announced Monday (July 24) that it has acquired a majority stake in the SoundAware Group, a Dutch company that provides music recognition services to collecting societies (including those in the Netherlands and Belgium) as well as market research and media companies. SoundAware will continue to operate independently from […]