Concord
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During the National Music Publishers’ Association (NMPA) annual meeting on Wednesday, the trade organization announced its latest board of directors.
The latest executive board includes: Jody Gerson (Chair and CEO, Universal Music Publishing Group), Keith Hauprich (general counsel and executive vp, business and legal affairs, North America, BMG), Laurent Hubert (CEO, Kobalt), Carianne Marshall (co-chair and COO, Warner Chappell Music), Jon Platt (chair and CEO, Sony Music Publishing), Jim Selby (chief publishing executive, Concord).
Other board members include: Marti Cuevas (founder and president, Mayimba Music), Justin Kalifowitz (executive chairman, Downtown Music Publishing), Golnar Khosrowshahi (founder and CEO, Reservoir), Jody Klein (owner and CEO, ABKCO), Kenny MacPherson (CEO, Hipgnosis Songs Group), Chip McLean (svp, head of business affairs and business development, Disney Music Group), Larry Mestel (founder and CEO, Primary Wave), Michael Molinar (general manager, Big Machine Music), Jeff Pachman (general manager, Domino Publishing), Ralph Peer II (executive chair, peermusic), Irwin Robinson (vp, Richmond Organization), Jon Singer (chairman, Spirit Music Group).
The 20-member board comprises an executive board featuring leaders from the six largest companies according to revenue from the previous year, a general board of 12 additional publishing leaders, and two songwriters representing creatives’ point of view. To represent songwriters, the board elected Laura Veltz to replace Liz Rose, who recently reached her term limit of four years. Ross Golan is returning as the other songwriter representative.
Domino’s Pachman is this year’s only new publisher to join the board, replacing Leeds Levy.
All board members receive equal voting power and will meet four times annually to oversee the activity and budget of the NMPA. The board plays a major role in determining the legal actions of the trade organization, which is known to fight aggressively for fair pay and licensing for compositions.
This year, the NMPA is focused on new legal action it is taking against Twitter, which was also announced at Wednesday’s event. According to the complaint, the NMPA — along with over a dozen of music publishers — is suing Twitter over allegations of widespread copyright infringement, seeking as much as $255 million in damages.
Concord CEO Scott Pascucci is stepping down effective June 30 after helming the fifth biggest music company for a decade. Bob Valentine, who ascended to president in 2021 from CFO, will become Concord’s new CEO.
Additionally, Concord’s chief label officer Tom Whalley will also vacate his role but will continue to be involved as founder of Loma Vista Recordings, his joint venture with Concord. Pascucci, who remains on Concord’s board of directors, and Whalley will be inaugural members of Concord’s new advisory board.
“I started my career in the music business 30-plus years ago for the simple reason that I love music, and I discovered along the way that I enjoy building businesses and leading teams of people,” said Pascucci in a statement. “Thanks to [Wood Creek founding partner] Brett Hellerman, I was given the opportunity to do all of those things at Concord. In 10 years, we have built a company that matters in the music industry, a place that cares about its employees, artists and writers, and that is well-positioned for the future. I am proud of all that we have accomplished. I look forward to continuing on the board of directors, to help guide the company forward under Bob’s leadership, while also having more time to focus on my interests in film and social impact initiatives.”
(Wood Creek Capital Management bought Concord from Village Roadshow in 2013. Concord is now a private company funded by institutional capital and Concord’s management team.)
Pascucci’s announcement comes several weeks after Concord launched Concord Music Royalties, LLC Series 2022-1, a $1.8 billion asset-backed security that will allow further growth through funding reserve accounts, paying down debt and other uses.
“It positions us beautifully for the future,” Pascucci tells Billboard of the security. “It has given us significant additional capital for growth while also dramatically broadening the base of institutional lenders who are now familiar with the company.”
The succession plan has been in the works since 2019. “An orderly succession in key positions is critical to the stability and future growth of the company, as evidenced by the smooth transition from Jake Wisely to Jim Selby as chief publishing executive a few years ago,” Pascucci continues. “ My decision to move out of the CEO position and to stay on the board was made over 2 years ago, at which time Bob moved into the role of president.”
Bob Valentine
Elena Goss/Courtesy of Concord
“Scott has made the transition from CFO to president remarkably smooth and easy,” Valentine says. “As CFO I was used to a particular flow of helping to finance our acquisitions and new productions; in stepping into the president’s role, I needed to get into the rhythm of the creative process outside of a purely financial lens. Scott’s extraordinarily patient, and he’s made sure to loop me in on some of the many day-to-day things that I wouldn’t have been in the middle of as CFO. Also, the senior team, most of whom are in Nashville, work very closely with each other. That makes a transition like this easier than they tend to be for a company.”
Valentine’s history with the company precedes Pascucci’s. He joined Norman Lear’s ACT III Communications in 1999 when it acquired Concord Records. He left in 2001 but returned in 2005 as CFO.
“I have had the privilege of helping to build Concord into the company that it is today ever since Norman Lear and his business partner Hal Gaba had the extraordinary foresight to buy a small, independent jazz record label in the same year that Napster was invented,” Valentine said in a statement. “The journey since then has been scary, thrilling, surprising, and incredibly rewarding.”
Valentine tells Billboard that Concord will proceed on its current path. “We’ll continue to focus on our core mission: to champion artists, elevate voices and impact culture. We can’t do any one of those without the other two. At the heart of everything we do is artistry; it’s our job to identify it, elevate it, and ultimately impact culture with it,” he says. That has been and will continue to be true for everything we focus on, whether it’s furthering our frontline label division’s breadth and depth, acquiring iconic songs and recordings, signing new and exciting songwriters, or licensing and co-producing theatrical works. I’m also excited about our Concord Originals segment, which aims to develop and adapt some of our music and theatrically based works (past and present) for film and television.”
Concord’s catalog consists of more than one million songs, composed works, plays, musicals and active recordings and includes works from Phil Collins, Creedence Clearwater Revival, John Fogerty, Daft Punk, Miles Davis, Danny Elfman, Evanescence, The Fania All-Stars, Genesis, Imagine Dragons, Isaac Hayes, James Taylor, Jewel, Joan Sebastian, Nine Inch Nails, Pink Floyd, Cyndi Lauper, Little Richard, Nikki Six, Otis Redding, R.E.M., Rodgers & Hammerstein, Pete Seeger, St. Vincent, Taking Back Sunday, Ryan Tedder, The Traveling Wilburys, The Vince Guaraldi Trio and Hans Zimmer.
Headquartered in Nashville, Concord has additional offices in Los Angeles, New York, London, Berlin, Melbourne and Miami. Concord also has staff in Auckland, Sydney, Tokyo and Toronto.
As chief label officer, Whalley oversees frontline imprints Fantasy Records, Concord Records, Concord Jazz, Rounder Records, Loma Vista Recordings, Easy Eye Sound, KIDZ BOP and Fearless Records.
“In 2014, I found a great partnership with Scott Pascucci and Concord,” says Whalley, who co-founded Interscope Records and was Warner Bros. Records chairman/CEO from 2001 to 2010. “That partnership helped build a very important independent label, Loma Vista Recordings. It has been an added bonus to serve as the chief label officer for frontline labels at Concord. I am very proud of what we have accomplished.”
Following Whalley’s departure, Concord will create a new role that will oversee the entire recorded music division, including frontline and catalog operations.
The new advisory board, which will be unveiled this fall, will also include Wisely, as well as other members from allied fields, such as music, film, theater and technology. It will act as a resource for best practices and new business opportunities for Concord.
Pascucci’s news comes a week after the announcement that Hartwig Masuch, CEO of BMG, the fourth biggest music company, is leaving at the end of the year after 15 years at the company. He will be replaced by BMG CFO Thomas Coesfeld.
In a happy ending to one of the music industry’s grimmest and longest tales, John Fogerty has gained worldwide control of his Creedence Clearwater Revival publishing rights after a half-century struggle.
At a time when Fogerty’s peers such as Bruce Springsteen, Bob Dylan and Neil Young are selling their copyrights for hundreds of millions of dollars, the iconic Rock & Roll Hall of Famer has done the opposite: He recently bought a majority interest in the global publishing rights to his historic CCR song catalog from Concord for an undisclosed sum. The treasure trove includes such rock classics as “Proud Mary,” “Down on the Corner,” Fortunate Son,” “Bad Moon Rising” “Up Around the Bend” and “Green River.”
Concord has owned the rights since 2004 when the company bought Saul Zaentz’s Fantasy Records. One of the first moves Concord made was to reinstate and increase Fogerty’s artist royalties, which Fogerty had relinquished to Zaentz in 1980 to get out of his Fantasy deal and had not received in 25 years.
Concord retains the CCR master recordings already in its catalog and will continue to administer Fogerty’s share of the publishing catalog for an unspecified limited time.
Seated on the spacious patio of his Southern California home with his golden retriever, Creedy (short for Creedence) by his side, Fogerty, 77, admits gaining control of his copyrights is a day he never thought would come. “I tried really hard,” he says to get them back in the decades since he signed his label and publishing deal in 1968 with Fantasy but suffered setback after setback at the hands of Zaentz, who died in 2014.
“I’m the dad [of these songs]. I created them,” he says. “They never should have been taken away in the first place. And that hijacking left such a massive hole in me.” With the support and love of his manager and wife of 36 years, Julie Fogerty, he says he had gotten over the anger that plagued him for decades over Zaentz’s treatment, but the longing to own his songs never went away.
John Fogerty
Julie Fogerty
“The happiest way to look at it is, yeah, it isn’t everything,” he says of acquiring a majority, but not full ownership. “It’s not a 100% win for me, but it’s sure better than it was. I’m really kind of still in shock. I haven’t allowed my brain to really, actually, start feeling it yet.” Fogerty, who had retained his writer’s share of his CCR copyrights, also owns the masters and publishing to his solo material, including such hits as “Centerfield,” “Rockin’ All Over the World,” and “Almost Saturday Night.”
The reclaimed CCR copyrights number more than 65, mostly written by Fogerty during the group’s short, but extremely prolific career. As one of America’s seminal rock bands, CCR had a tremendous run, including landing five top 10 albums on the Billboard 200 between 1969 and 1970 before breaking up in 1972. Their popularity continues with new generations: CCR’s Chronicle: The 20 Greatest Hits, released in 1976, has spent 622 non-consecutive weeks on the Billboard 200, the fifth highest of any album on the chart. More than 50 years after its initial release, CCR hit “Have You Ever Seen the Rain” reached No. 1 on Billboard’s Rock Digital Songs Sales Chart in 2021.
Keep On Chooglin’
The latest effort to gain ownership of his publishing began 18 months ago as the Fogertys realized that under U.S. copyright law, rights to his compositions would begin reverting back to him in a few years as the songs turned 56 years old, but that wouldn’t have included rights outside the U.S. “Julie began to think larger and [told Concord], ‘John would like to buy his songs. He’d like to figure out a way’,” Fogerty says.
“While John is having the time of his life out there on the road, with his kids playing with him and celebrating this music, [I thought], why can’t we take those few years left [before the titles revert] and not have them give them to us, but we’ll buy them,” Julie Fogerty says. “Whatever the value plus a little bonus. We’ll figure out how to come up with the money and we’ll just buy that. [Concord’s] not going to lose because they’ll have the value.”
Concord initially declined and Fogerty was once again resigned. “I was sort of a bump on the log going, ‘Never going to happen,’” he says.
Julie Fogerty then brought in Irving Azoff, who had briefly managed Fogerty more than 20 years ago, to help mediate. She says Azoff called Concord chairman and CEO Scott Pascucci and said, “‘Scott, you’ve made so much money on Fogerty. Do you want to be known in the music business as Saul Zaentz or [revered late Warner Brothers Records head] Mo Ostin?’ And I think he heard that. And [Concord president] Bob Valentine has been incredible as well.’” Azoff encouraged the Fogertys to pursue worldwide rights, advising they would have to give up an ownership percentage in order to do so.
“John Fogerty is one of music’s greatest treasures. Now, finally after decades of suffering, I’m thrilled to see John regain ownership of his music,” Azoff tells Billboard in an email. “And kudos to Concord for understanding that doing the right thing for artists is great for their business as well.”
“John’s songs are some of the greatest compositions of the 20th century,” Valentine said in a statement. “We’ve been honored to own and represent these works ever since we acquired Fantasy in 2004. Given the unique set of circumstances around the history of John’s relationship with Fantasy, we were more than happy to oblige John and Julie in working out an agreement for these songs to revert back to him early. And we’re profoundly grateful that John has agreed to partner with Concord for the remaining worldwide copyrights on the share of these songs that we will retain.”
Fogerty was represented by Barnes & Thornburg partner Jason Karlov and associate Amanda Taber. Reed Smith’s Steven Sessa and Josh Love represented Concord.
The winding journey to reclaim his rights and undo the damage from his contentious relationship with Zaentz has been long and, at times, debilitating for Fogerty.
In addition to taking his artist royalties for decades, in 1985, Zaentz sued Fogerty for $144 million, alleging the artist’s then current hit, “The Old Man Down the Road,” ripped off CCR’s “Run Through the Jungle.” Even though Fogerty had written both songs, Zaentz claimed Fogerty was now plagiarizing a song Zaentz owned. After Fogerty won, his effort to be reimbursed for his $1.3 million in legal fees went all the way to the Supreme Court in 1993.
For years, Fogerty refused to play CCR songs live, unable to stomach Zaentz making money off his performances, but he softened his stance in 1987 with a little prodding from Bob Dylan. While at revered North Hollywood, Calif., club the Palomino, Fogerty, Dylan and George Harrison joined headliner Taj Mahal on stage. “The crowd started asking for ‘Proud Mary,’” Fogerty recalls. “Bob looked at me and said, ‘John, if you don’t do ‘Proud Mary,’ everybody’s gonna think it’s a Tina Turner song,’” referencing Ike & Tina Turner’s 1971 cover. “It’s Bob Dylan, for crying out loud. In my mind, I was still committed that I wasn’t going to do those songs, but I decided I guess I can give that up for three minutes.” Later that year, Fogerty began incorporating CCR songs back into his set.
‘They Tried to Erase Him’
Fogerty last tried in 1989 to buy his publishing when he and Zaentz sat face-to-face with legendary rock empresario Bill Graham acting as a mediator. They agreed on a sum, but then months later in final negotiations in the early ’90s, Fogerty says Zaentz doubled the price to a figure Fogerty couldn’t afford. Fogerty went to Warner Chappell and asked if the publishing company would go in on a deal with him. “I met with the top guy, and he looked at me and said, ‘It’s not sustainable.’ That might have been, at least as business kinds of things go, the worst day of my life,” Fogerty says. “I don’t think I could even impart to [Julie] how final that was: ‘There’s no hope for you. You’re dead.’”
He had a freeing revelation shortly thereafter when on a jog, he was listening to a radio therapist counsel a woman who had been with a man who refused to commit to marriage. The therapist told the women her boyfriend was never going to change, and she needed to understand that. “The light goes on in my head as I’m listening and I just fell on the ground,” Fogerty says. “I actually started laughing. I realized it was never going to happen. It was a horrible realization. Anyway, that was the end of that: Saul was a jerk and will be eternally that and, in some way or fashion, I got over that.”
When asked if he now would pursue ownership of his CCR masters, Fogerty says, “My heart of hearts would love if that ever happened, but I’m not actively sitting around worrying about that. The fact that I didn’t own my own songs was much more bothersome to me because of the treatment that I received.”
For now, Fogerty, whose last release was the socio-political track, “Weeping in the Promised Land,” in 2021, is focused on playing live. With his two sons in his touring band, he says, “playing is more joyful now than in any time in my life…. The last years of Creedence got to be like every band that dissolves, it was so tense. I mean, I miss my brother, [Creedence rhythm guitarist] Tom, who passed at a time when we were not really in each other’s lives [in 1990]. I’m looking forward to getting to heaven and playing in God’s band and Tom will be there.”
With control over how his music is used now, Julie Fogerty says she’d like “to take these iconic songs and reintroduce them to the new generation because I think the songs will be around forever,” adding there’s talk of both a biopic and a documentary about Fogerty. “But it’s mostly I think just connecting John to those songs. There were a lot of years where he felt like they tried to erase him.”
For Concord’s part, which released Creedence Clearwater Revival at the Royal Albert Hall last year without Fogerty’s participation, Valentine tells Billboard he hopes regaining his copyrights “gives John a sense of closure for the years of the feelings that he’s had ever since he signed with Fantasy…. Also, hopefully, [with] that sense of peace that it’s a new beginning. We hope he will be reinvigorated and continue to do things that promote the catalog. It’s extraordinarily important — not only culturally as one of the greatest American bands ever, but it’s an important component of Concord’s legacy. We hope it gives him a feeling of partnership and moving forward in a way that makes him feel more invested in the songs and Creedence with us.”
As Fogerty moves into the next chapter with the “lingering specter” that has haunted him for so long finally gone, he says with a big grin, “I’m ready to feel really good about music.”
The Ledger is a weekly newsletter about the economics of the music business sent to Billboard Pro subscribers. An abbreviated version of the newsletter is published online.
This was a year without splashy public offerings, like Universal Music Group’s last year and Warner Music Group’s the year before. Some of the biggest rights acquisitions of all time — for Bob Dylan’s and Bruce Springsteen’s recordings and publishing, and David Bowie’s publishing took place in those years, too. And the time when the biggest companies in the business could acquire their rivals may be over for the time being as well.
Rising interest rates put a chill on the catalog acquisition market and brought down valuations, but there was no shortage of investors for a seemingly never-ending supply of creators willing to take advantage of the streaming boom to part with their catalogs. The list of deals that didn’t even make this list includes various rights for the music of The Ramones, Justin Timberlake, Keith Urban, Louis Prima, Swedish House Mafia, Future and Blake Shelton.
Only two of the last year’s top 10 deals — ranked by dollar amount — didn’t involve a catalog changing hands. One was a reverse merger that made French streaming company Deezer a publicly traded company, while he other was Spotify’s latest acquisition to further its goal of becoming a one-stop destination for audio.
Concord sells asset-backed securities ($1.8 billion)
This month, Concord priced the biggest music-related asset-backed securitization in history: $1.8 billion of senior notes backed by a diversified catalog of music publishing and recorded music rights valued at $4.1 billion. Apollo’s Capital Solutions business structured the transaction and formed an investor syndicate led by Apollo-managed funds. JP Morgan was the co-structuring agent. Music-backed securitization was made famous in 1997 with $55 million of asset-backed securities, commonly referred to as Bowie Bonds, supported by royalties from Bowie’s recorded music catalog. Concord’s offering was significantly larger and diverse than Bowie’s: The catalog behind Concord’s bonds includes compositions and recordings by Phil Collins, Creedence Clearwater Revival, Daft Punk, Miles Davis, Imagine Dragons, Pink Floyd, Cyndi Lauper, Little Richard and James Taylor.
Brookfield Asset Management Invests in Primary Wave ($1.7 billion)
The biggest music industry deal of the year by dollar amount was something of a surprise. The 100-year-old Canadian asset manager Brookfield’s decision to put $1.7 billion into Primary Wave, an active buyer of music rights for nearly 17 years, came during a lull in the market. Rising interest rates were making music rights a less attractive investment, headline-grabbing acquisitions had slowed since the Fed began hiking rates in March and possible changes to tax treatment of catalog sales in 2022 culminated a busy 2021. Brookfield wasn’t discouraged by market forces, though. The two companies spent six months hashing out a deal, Brookfield managing partner Angelo Rufino told Billboard. Brookfield was attracted to Primary Wave’s model of employing marketing and branding experts to build the value of its acquisitions. He called Primary Wave CEO Larry Mestel “the best I’ve ever seen at leveraging brand extensions to supercharge the growth of these assets.”
Kobalt sells majority interest to Francisco Partners ($750 million)
Kobalt has been selling off assets left and right in recent years. It sold its two investment funds that owned music assets — one went to Hipgnosis Song Management for $323 million in 2020, the other to KKR and Dundee Partners for $1.1 billion in 2021 (which resulted in the Chord Music Partners bond offering this year, see below) — and Sony Music purchased Kobalt’s independent distributor and label services provider, AWAL, as well as its neighboring rights business. These moves allowed Kobalt to pay off its debt and finish 2021 with $315 million in cash. This year, Kobalt sold a piece of itself when tech-focused investment firm Francisco Partners, along with Dundee Partners and Matt Pincus’ MUSIC, bought a majority stake in the company for $750 million.
KKR sells asset-backed security ($732.5 million)
The technical sounding Hi-Fi Music IP Issuer II L.P., Series 2022-1, was a bond offering by Chord Music Partners in February, backed by a music catalog valued at $1.13 billion. What the bond lacked in curb appeal it made up for in sheer dollar volume after raising $732.5 million for Chord Music Partners, a venture of KKR Credit Advisors and Dundee Partners. The music publishing catalog behind Hi-Fi Music offering — about 62,000 titles in all — was purchased from Kobalt three months earlier. The According to a report by ratings agency KBRA, the Hi-Fi offering is backed by over 65,000 compositions and master recordings and related assets and includes artists and songwriters such as The Weeknd, Maroon 5, Childish Gambino, Dua Lipa, Mumford & Sons and Stevie Nicks.
Concord acquires Genesis, Phil Collins and Mike + The Mechanics rights ($335 million to $375 million)
Phil Collins’ and Genesis’s The Last Domino tour, which concluded at London’s O2 Arena in March, was a reminder of how beloved the 71-year-old Collins remains 47 years after he took over vocal duties when original Genesis singer Peter Gabriel departed in 1975. In that warm afterglow, Concord acquired the recording catalogs and music publishing rights of Collins, as well as Tony Banks and Mike Rutherford for the years they were in Genesis and Mike + The Mechanics, for something in the range of $335 million to $375 million. (Former Genesis members Peter Gabriel and Steve Hackett did not participate in the deal.) Collins’ solo material, focused on a string of four multi-platinum albums from 1981 to 1989, has 403 million streams in the U.S. this year (through Dec. 8), according to Luminate. In addition, Collins’ catalog has nearly 311,000 airplay spins this year. The acquisition includes Collins’ signature solo hit “In The Air Tonight,” from the 1981 album Face Value, that counts for more than a quarter of his year-to-date on-demand streams, and “That’s All,” a No.6 hit on the Hot 100 from the 1983 album Genesis. “Everyone at Concord feels the weight of the cultural significance of this remarkable collection of works,” Concord president Bob Valentine said when the deal was announced.
Sting sells entire publishing catalog to Universal Music Group ($360 million)
Universal Music Group isn’t the most active buyer of music catalogs, but it makes a splash when it decides to pull the trigger. In 2020, it purchased Bob Dylan’s publishing catalog for an estimated $400 million. In February, UMG acquired Sting’s entire publishing catalog, including his compositions with The Police (Sting was the sole songwriter of the group’s most popular songs, such as “Roxanne,” “Every Breath You Take,” “Message in a Bottle,” “Every Little Thing She Does is Magic”) as well as his solo material (“Fields of Gold,” “Englishman in New York,” “Shape of My Heart,” “If You Love Somebody Set Them Free”). Because UMG already has the master recordings to both the Police and Sting’s solo releases, buying the publishing catalog brings both rights under one roof. That should facilitate licensing and enhance UMG’s ability to generate income from the catalog. Billboard believes Sting’s representatives were shopping the catalog with a $360 million price tag, making the deal the largest for a single artist in 2022. Across both the Police and Sting’s solo releases, the catalog generated 469 million on-demand streams in the U.S. in 2022 (through Dec. 8), according to Luminate.
HarbourView Equity Partners acquires SoundHouse ($325 million)
HarborView Equity Partners burst onto the music business scene in 2021, led by founder and CEO Sherrese Clark Soares, an alum of Morgan Stanley and Providence Equity Partners-backed Tempo Music, and $1 billion backing by Apollo Global Management. Among its initial deals were the publishing catalog of Latin star Luis Fonsi that includes a share of the global hit “Despascito,” the master recording income of country star Brad Paisley, the publishing catalog of country group Lady A and the publishing catalog of Dre & Vidal, the songwriting and production duo who has worked with Alicia Keys, Justin Bieber and Mary J. Blige. HarborView’s biggest-single acquisition is an unknown name with considerable star-power: SoundHouse, the owner of about 20 master recording catalogs and the assets of indie contemporary Christian label InPop. That gave HarborView the rights to some master recordings by the likes of Tech N9ne, Trey Songz, George Jones, Whiskey Myers and Tenth Avenue North. Billboard estimates the deal was worth about $325 million. SoundHouse’s 2021 income was said to be about $24 million.
Sony Music acquired Som Livre ($255 million)
Brazil’s largest domestic record label hit the market as its parent company, Grupo Globo, went through organization restructuring. Announced in 2021, Sony Music’s acquisition Som Livre was finalized in Feb. 2022 after Brazilian regulators said there would be “low market concentration and low barriers to entry” from the merger, despite Sony already having the top record label market share in Brazil and Som Livre being third behind Universal Music Brasil. Som Livre is home to more than 80 artists, including sertanejo act Jorge & Mateus, forró star Wesley Safadão and rising stars like Israel & Rodolffo. Domestic music accounts for 70% of total music consumption in Brazil, the world’s 11th largest recorded music market in 2021, according to the IFPI.
Sony Music acquired Bob Dylan’s recorded music catalog ($200 million)
Thirteen months after Universal Music Group acquired Bob Dylan’s songwriting catalog, Sony Music picked up the bard’s recorded music catalog. Sony has not disclosed the terms of the transaction, but Billboard estimates the catalog generates roughly $16 million per year globally and is worth $200 million or more. The catalog covers all of Dylan’s recordings — 39 studio albums and 16 compilations in the Bootleg series — as well as unreleased material that could be released on future collections. (Separately, Primary Wave acquired Dylan’s share of the master and neighboring rights royalties from the Traveling Wilburys supergroup.) It makes sense that Dylan’s recordings ended up with Sony. The artist spent almost his entire career at Columbia Records, save two albums, Planet Waves and Before the Flood, both released by David Geffen’s Asylum Records in 1974 but distributed by Sony for decades. Dylan’s catalog amassed 313.5 million on-demand streams in 2022 (through Dec. 8), according to Luminate, and provides Sony with ample opportunities for licensing for film, television and advertisements (Airbnb used his track “Shelter From The Storm” from 1975’s Blood on the Tracks in a television ad this year). He used his return to Columbia in 1974 to gain ownership of his recordings, according to Dylan: A Biography by Bob Spitz.
Universal Music Group acquires Neil Diamond Catalog ($145 million)
In February, Universal Music Group announced a deal to acquire Neil Diamond’s song and master recording catalogs, reuniting Diamond’s non-UMG work with music released through UMG’s MCA Records during the artist’s successful 1968 to 1972 streak. Diamond’s catalog includes “Sweet Caroline,” “Cracklin Rosie” and “Forever iIn Blue Jeans.” His songwriting catalog includes compositions for other artists that reached No. 1 on the Billboard Hot 100 chart: “I’m a Believer” by The Monkees (1966); “You Don’t Bring Me Flowers” by Barbra Streisand (1978, co-written with Alan and Marilyn Bergman); and “Red, Red Wine” by UB40 (1988). Additionally, the recording of “Girl, You’ll Be a Woman Soon” by Urge Overkill has an indelible place in pop culture for its use in Quentin Tarantino’s 1994 movie Pulp Fiction. The trove of material included 110 unreleased tracks, an unreleased album and archival video. The deal also includes the rights to release any future music by Diamond should he return to the studio. Billboard estimates the deal was worth about $145 million.
Deezer’s reverse merger with SPAC I2PO ($143 million)
Deezer was one of two music companies to go public in 2022 through a reverse merger with a special purpose acquisition company (SPAC) in April before the SPAC craze fizzled in the second half of the year. (The other was Anghami, an Abu Dhabi-based streaming service. A third, wholesale distribution giant Alliance Entertainment, plans to complete a reverse merger with Adara Acquisition Corp.) The reverse merger with French company I2PO, which traded on the Euronext Paris exchange, provided Deezer with 135 million euros and valued Deezer at 1.08 billion euros ($1.17 billion at the time). The money came through a PIPE (private investment in public equity) subscribed by most of Deezer’s existing shareholders, including Access Industries, Universal Music Group, Warner Music Group, French telecom company Orange, Kingdom Holdings, Eurazeo and Xavier Niel. After investors poured money into blank check companies in 2020 and 2021 in pursuit of companies to take public, SPAC deals are increasingly rare these days. Among the many SPACs to end their search and return funds to shareholders are Music Acquisition Corp, which raised $230 million in Feb. 2021, and Liberty Media’s $575 million Liberty Media Acquisition Corporation.
Spotify acquired audiobook distributor Findaway ($122 million)
Findaway was neither Spotify’s priciest acquisition — it paid more for podcast companies The Ringer and Gimlet and tech platforms Anchor and Megaphone — nor was it the splashiest deal the music streaming giant has made in its roughly 15-year history. But buying the Ohio-based audiobook distributor was a pivotal moment in the company’s years-long transition from a music platform to a broader audio platform. With its share price down 68.1% year to date and investors anxious for profits, Spotify is betting that being a single destination for all things audio is a better strategy than focusing solely on music. The more ways Spotify can keep people listening, the idea goes, the longer consumers will engage with the platform , which in turn will funnels more people from the free version to the subscription service. Plus, audiobook margins are about double what Spotify gets for licensing music. Audiobooks also fit neatly with Spotify’s ongoing battle with Apple over the latter’s 30% share of in-app purchases and subscription revenue. Spotify CEO Daniel Ek’s PR push in recent months has been aided — and overshadowed — by new Twitter CEO Elon Musk’s public takedown of Apple over the same in-app fees.
Independent music company Concord is the latest to tap into a growing market for music royalty-backed securities with Concord Music Royalties, LLC, Series 2022-1, a $1.65 billion asset-backed security. The bond will be supported by mechanical, performance and synchronization royalties from more than 1 million assets.
The proceeds will be used to fund reserve accounts, pay transaction expenses, repay debt and for other general corporate purposes, according to a report by ratings agency KBRA.
KBRA gave Series 2022-1 a preliminary rating of A+ (on a scale ranging from AAA to D), citing the “large, diversified catalog with globally recognized songs and artists” such as R.E.M., Plain White T’s, Creed, Evanescence, Genesis, Phill Collins and Mike + The Mechanics — the latter three being purchased just two months ago.
The catalog generated $344.7 million in 2021, with 63% coming from recorded music and 37% from music publishing. More than 41% of the catalog’s assets were released more than 20 years ago and 23% are between 10 and 20 years old. About 3.5% of the catalog is comprised of frontline releases, defined by KBRA as “recently recorded and released music with little or no history,” and option rights that Concord can exercise for rights to future recorded music or publishing from artists in the catalog.
FTI Consulting put a $4.1 billion valuation on the catalog, according to the KBRA report. That’s about the same amount Billboard estimated Concord’s price tag would be when the company was exploring a sale in 2021 — before the purchase of the Genesis, Phil Collins and Mike + The Mechanics catalogs that Billboard estimated were worth at least $335 million and its acquisition of Australian music publisher Native Tongue. Concord had sought additional equity from its majority owner, the Michigan Retirement Systems pension fund, but turned to debt in 2020 to raise $600 million, which it used to pay down existing debt.
Among the offering’s sound recordings, Concord Music Group administers a majority and Universal Music Group distributes a majority. Concord Music Publishing administers most of the music publishing rights and ICE, ASCAP and BMI are the collective management organizations for most of the publishing rights.
Series 2022-1 contains two components: Class A-1 VFN, with a principal balance of $150 million and an anticipated repayment date of January 2026; and Class A-2, with a principal balance of $1.5 billion and an anticipated repayment date of January 2029. Class A-1 VFN will have a variable interest rate — the secured overnight financing rate plus a margin — and Class A-2 will have a fixed interest rate. The notes will pay interest quarterly.
Concord’s offering is the largest of the music royalty-backed offerings rated by KBRA in the last 12 months. KKR’s Hi-Fi Music IP Issuer II, backed by about 62,000 songs, raised $732.5 million in February. Crescendo Royalty Funding, a joint effort of Lyric Capital Group and Northleaf Capital Partners and backed by over 52,000 songs owned by Spirit Music Group, raised $303.8 million in Dec. 2021. Hipgnosis Music Assets 2022-1, backed by the Kobalt Music Copyrights Fund 1 that Hipgnosis Songs Fund acquired in 2020, raised $221.7 million in Dec. 2021.