State Champ Radio Hipgnosis
Sony Music Publishing has acquired Hipgnosis Songs Group, multiple sources confirmed to Billboard. Emails obtained by Billboard under the subject line “Update from Sony Music Publishing” said that the company “has entered into an agreement with Recognition Music Group (‘RMG’) to acquire its subsidiary Hipgnosis Songs Group (‘HSG’), effective immediately.”
Hipgnosis Songs Group is one of the companies considered to be under the umbrella of Recognition Music, formerly known as Hipgnosis — which also included Hipgnosis Songs Fund and Hipgnosis Song Management — and is the subsidiary that has housed Big Deal Music and its administration business since the company acquired Big Deal in 2020.
The HSG catalog includes the 4,400 copyrights originally from Big Deal, including songs recorded by Shawn Mendes, Panic! At the Disco and One Direction. According to HSG’s Instagram page, their repertoire also includes publishing shares of songs like “Taste,” “Espresso” and “Feather” by Sabrina Carpenter; “Ordinary” by Alex Warren; “Lose Control” by Teddy Swims; and many more current hits.
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“With this agreement, Sony Music Publishing now owns and administers the Hipgnosis Songs Group catalog, serving as the full-service publisher for its clients and roster of songwriters globally,” the email to HSG songwriters, composers and clients reads.
The news of this deal arrives just three months after Hipgnosis rebranded under the new name Recognition Music Group, bringing the bundle of related Hipgnosis titles under one name and one roof. As part of that previous news, it was noted that Hipgnosis Songs Group was still under the ownership of Blackstone and that the company said the division was under strategic review. Billboard reported that Recognition was looking to partner with publishers and music companies for the administration of their assets.
Over the years, Hipgnosis has largely driven the movement to treat music as an attractive asset class for Wall Street investors, bidding sky-high prices for catalogs by Red Hot Chili Peppers, Neil Young, Lindsey Buckingham, Blondie, Justin Bieber and Journey, among others. But Hipgnosis Songs Fund, which was publicly traded on the London Stock Exchange since 2018, has had a rocky last few years. By 2023, HSF ultimately left its investors frustrated as its stock price fell and its dividend was cancelled. Eventually, in July 2024, HSF was sold to private equity giant Blackstone for $1.6 billion.
A rep for Recognition Music declined to comment. Reps for Sony Music Publishing did not immediately respond to Billboard’s requests for comment at press time.
The email notes that “over the next few months, we will be transitioning the company to SMP’s services and systems. We are working closely with HSG to ensure that all clients will receive the high level of service that you have come to expect.”
By acquiring hits owned or administered by HSG, Sony Music Publishing — which often ranks as the largest publisher by market share on the Hot 100 and Pop Radio Airplay charts on Billboard’s Publishers Quarterly — has become an even more dominant player in popular music.
Read an excerpt of the email below:
Dear Hipgnosis Songs Group Songwriters, Composers and Clients:
On behalf of Sony Music Publishing (“SMP”), we are pleased to inform you that Sony Music Publishing has entered into an agreement with Recognition Music Group (“RMG”) to acquire its subsidiary Hipgnosis Songs Group (“HSG”), effective immediately.
With this agreement, Sony Music Publishing now owns and administers the Hipgnosis Songs Group catalog, serving as the full-service publisher for its clients and roster of songwriters globally.
With a unique roster of contemporary songwriters and timeless classics, HSG aligns with SMP’s mission to elevate and support the work of the world’s most impactful songwriters, and we are honored to represent you and your songs.
Over the next few months, we will be transitioning the company to SMP’s services and systems. We are working closely with HSG to ensure that all clients will receive the high level of service that you have come to expect. No further action is required from you at this time.
In the meantime, your current HSG team remains available to address questions or creative inquiries. You can also reach HSG at HSGcreativeteam@hipgnosissongs.com. For the time being, your royalty payments will continue to be processed and distributed through HSG’s system and your current account access remains unchanged. We will reach out to you directly with important transition updates as they come.
Thank you. We look forward to working with you in this next chapter.
Sincerely,
The Sony Music Publishing Team
Hipgnosis, the catalog company with rights to songs by artists including the Red Hot Chili Peppers that became the face of music-as-an-asset-class for Wall Street investors, is being renamed Recognition Music Group, the company said on Wednesday (March 12).
The new name covers what was previously three separate companies that each had Hipgnosis in the name: Hipgnosis Songs Fund, a publicly traded music royalty investment fund formerly listed on the London Stock Exchange; Hipgnosis Songs Assets, a privately-held royalty fund backed by Blackstone; and Hipgnosis Song Management, the investment manager previously run by founder Merck Mercuriadis that worked to generate a return on the song rights held in the catalog funds.
Mercuriadis did not respond to a request for comment.
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Since Blackstone acquired Hipgnosis’s public fund for $1.47 billion and Mercuriadis stepped down from his role as chair of the investment manager last year, the company decided it was time to shed the old name, CEO Ben Katovsky tells Billboard.
Recognition’s portfolio of publishing and master recording rights to some 45,000 songs include stakes in megahits like Shakira‘s “Whenever, Whereever,” The B-52s’ “Love Shack,” Fleetwood Mac‘s “Go Your Own Way” and Diana Ross‘ “I’m coming out.” A video made by the company to promote its new name to its roughly 40 employees weaves together lyrics from these and other songs in its portfolio to send a message that despite their history as separate entities, the Hipgnosis companies are meant to “get together,” even if one almost went its “own way” during Blackstone’s billion-dollar bidding war with Concord. Nearly a year after it consolidated ownership, Blackstone and Katovsky “want the world to know” this is a new company.
“It’s impossible not to have those songs resonate in your mind,” Katovsky says from Recognition’s London offices. He tells Billboard that the new name refers to “a combination of how easy it is to recognize those songs day to day and also to recognize the talent of the artists and songwriters and musicians who made those songs.”
Qasim Abbas, Blackstone’s head of tactical opportunities international, the division of the global financial fund that owns Recognition, said in a statement that last year showed “strong investor conviction in this asset class.”
“The company is now set to build on its position as a leading independent investor in music rights; owning and managing an incredible portfolio of songs and recordings,” Abbas added.
Hipgnosis was known for acquiring dozens of catalogs a year between 2018 and 2021, earning it a reputation of contributing to a run-up in the market for music royalties. In contrast, Recognition intends to be a “selective buyer” of music rights, Katovsky says.
“Our ambition is to continue to grow the portfolio, and we already have scale as a business,” Katovsky says. “The scale allows us to invest … but it also means we’re not under any pressure to deploy capital.”
Recognition’s portfolio remains heavily weighted to publishing rights, which comprise roughly 80% of its assets; the remainder are mostly master recording rights. Blackstone still owns Hipgnosis Songs Group, the subsidiary that has housed Big Deal Music’s administration business since Hipgnosis acquired the independent publisher in 2020. The company has said the division is under strategic review, and Recognition is now looking to partner with publishers and music companies for the administration of its assets.
“Recognition Music will be a very collaborative player in this space in ways that it was not historically,” Katovsky says. “We want to work with other partners in this industry to do that.”
Hipgnosis Songs Fund, one of the most influential players in the catalog acquisition market run-up of recent years, and Barry Manilow are embroiled in a pair of lawsuits over $1.5 million in unpaid bonuses Manilow’s team claims Hipgnosis agreed to when it acquired his catalog.
Hipgnosis Songs Fund sued first in the High Court in London on August 12, saying they do not owe Manilow these bonuses, and that Manilow, Manilow Productions and Stiletto Entertainment are in breach of contract for not turning over certain payments they received from Sony Music. The “Mandy” singer and his management company sued back in United States federal court in California on Aug. 28, claiming that Hipgnosis does owe Manilow $1.5 million in bonuses, and that the fund did not actively promote his work, thereby avoiding these performance-linked bonuses — logic Hipgnosis calls flawed.
In other circumstances, this may have been treated like a mundane contract dispute. But Manilow’s legal team allege in the suit that Hipgnosis, through its founder Merck Mercuriadis — the man behind the formerly London-listed fund’s famous appetite for acquisitions — falsely represented that it had the people and know-how to increase the money generated by Manilow’s master recordings. Mercuriadis is not party to either lawsuit, and through a spokesperson he declined to comment for this article.
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According to a copy of the contract included in Hipgnosis’ lawsuit, the company acquired 100% of Manilow’s worldwide income (excluding SoundExchange royalties) from his master recordings for $7.5 million. Two bonus payments were to be paid out if, for the first payment, the income Hipgnosis received from its share of the assets increased by at least 10% year-on-year compounding for each of the first three years; and if, for the second payment, the income Hipgnosis received increased by at least 10% year-on-year compounding for years one through four.
Manilow’s legal team says in its suit that Hipgnosis described promotional strategies that included album reissues, special compilations and synch deals, as well as less traditional strategies like a YouTube Karaoke channel, Instagram giphy packs and Copacabana-themed dance trends.
“Hipgnosis did not carry out a single one of its touted promotional strategies; upon information and belief, it did nothing at all in order to keep the cash income below the levels required to meet the condition precedent for the additional purchase price payments,” Manilow and Stiletto Entertainment’s legal team alleges in the complaint. Manilow also missed out on expected complementary increases in the value of his publishing royalties and his Las Vegas residency, they claim in the suit.
In its suit, Hipgnosis alleges that Manilow, Manilow Productions and Stiletto Entertainment breached their contract that laid out when bonuses would be paid because Manilow & co. received two royalty payments from Sony — for the period from July 1 to December 31, 2022, and January 1 to June 30, 2023 — that they ought to have turned over to Hipgnosis but didn’t. In addition, Hipgnosis says in the lawsuit that Sony Music suspended payment of royalties for the period from July 1 to December 31, 2023. Sony Music through a spokesperson declined to comment.
Regardless, Hipgnosis says in the suit it does not owe the bonuses because the income received never met the performance targets, and it is seeking to recover 100,000 pounds from Manilow and his production and management teams.
“The matter of the bonus payment is a routine contractual matter regarding interpretation of certain contract clauses,” a Hipgnosis spokesman said in an emailed statement. “While we regret that this couldn’t be resolved directly between the parties, the court is now best placed to offer a final and definitive opinion on this matter. We have full confidence in our position and the legal process.”
Representatives for Hipgnosis also dispute Manilow’s team’s logic that Hipgnosis did not promote his works so as to keep the income levels below the thresholds that would trigger the bonus payouts, saying that logic is false because acquisition deals are structured to incentivize Hipgnosis to optimize the asset. Performance bonuses by definition are paid out when the asset does well, which benefits the artist and Hipgnosis, they say.
“Hipgnosis’ model is based on a strong alignment of interest between songwriters and artists and our business,” Hipgnosis’ spokesperson said in the emailed statement. “We continue to hold Barry and his music in the highest possible regard. To suggest that Hipgnosis would deliberately withhold promotional efforts for these recordings would not make commercial sense. These claims are baseless, and we will defend them vigorously should that be necessary.”
Manilow’s case is currently a one-off. However, the board of Hipgnosis Songs Fund said that, as of Sept. 30, 2023, it was liable to pay out as much as $68.1 million in catalog bonus provisions across 10 catalogs, of which the disputed Manilow bonuses are just one. Hipgnosis Songs Fund has since been taken private by Blackstone and no longer discloses this level of financial data.
Barry Manilow is suing Hipgnosis Songs Fund (HSF) in federal court in California seeking $1.5 million in unpaid bonuses related to the music rights company’s acquisition of his catalog four years ago. The suit by the “Mandy” singer, along with his management company Hastings, Clayton & Tucker Inc, or Stiletto Entertainment, follows a similar lawsuit […]
LONDON — Hipgnosis Song Fund is suing Barry Manilow over bonus payments relating to its acquisition of the singer’s catalog four years ago.
The lawsuit was filed at the High Court in London on Monday (Aug. 12). The case is listed as breach of contract, but details of the claim are not publicly available. Three defendants are listed on the court filing: Manilow; Manilow Productions; and the artist’s management company – Hastings, Clayton & Tucker Inc trading as Stiletto Entertainment. News of the court case was first reported by the Financial Times.
In a statement to Billboard, a spokesperson for Hipgnosis described the dispute as a “routine commercial matter concerning the interpretation of certain clauses in a contract regarding bonus payments, which the court is ideally placed to address.”
“While we regret that this couldn’t be resolved directly between the parties, we continue to hold Barry and his music in the highest possible regard and we are confident that this can be resolved in a fair and reasonable way,” the spokesperson went on to say.
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Billboard understands that the claim is for a low sum in the single digit millions. Representatives for Manilow either did not respond to requests to comment or could not be reached.
The court action comes almost exactly four years after Hipgnosis announced that it had acquired 100% of Manilow’s worldwide recording royalties (excluding SoundExchange royalties) in his catalog, comprising 917 songs, for an undisclosed figure. The deal included some of the 81-year-old singer’s biggest hits, including “Mandy,” “I Write the Songs,” “Looks Like We Made It,” “Can’t Smile Without You” and “Copacabana (At the Copa).”
Speaking in 2020, at the time of the catalog acquisition, Hipgnosis founder Merck Mercuriadis called Manilow “an incomparable artist, songwriter, arranger, musician and performer,” while the veteran singer praised Mercuriadis for creating “a new type of music company.”
A great deal has changed at Hipgnosis since then.
Last month, private equity group Blackstone completed a $1.6-billion acquisition of the six-year-old, London-listed investment trust that had amassed a huge catalog of 65,000 copyrights including songs by Red Hot Chili Peppers, Journey, Shakira, Blondie and Neil Young.
The takeover followed a tumultuous year in which the publicly traded fund faced a shareholder revolt following a series of missteps and accounting scandals, culminating in bitter infighting between the fund’s board and its investment manager, Hipgnosis Song Management, which was led by Mercuriadis.
The former manager of star acts like Beyoncé, Guns N’ Roses and Elton John announced that he was stepping down as chairman of Hipgnosis Song Management in July, having relinquished his role as chief executive officer earlier this year.
Six years after going public on the London Stock exchange, a majority of Hipgnosis Songs Fund shareholders voted on Monday (July 8) to sell the fund to Blackstone for $1.6 billion, according to a regulatory filing. According to the filing, 99.97% of shares voted voting in favor of selling to the private equity giant–59.21% of […]
Hipgnosis Song Management announced on Tuesday that Merck Mercuriadis will be stepping down as chairman of the music investment advisor. In giving his notice, which goes into effect upon closing of the proposed acquisition of Hipgnosis Songs Fund to private equity giant Blackstone, HSM’s founder called it the “right time” and a “timely opportunity for me […]
Blackstone doesn’t intend to increase its latest offer to acquire Hipgnosis Songs Fund (HSF), the London-listed investment trust it first launched a takeover bid for on April 20. The private equity firm said in a regulatory filing Tuesday (June 25) that the financial terms of its June 3 offer “are final and will not be […]
Global investment giant Blackstone said on Monday it would pay a penny more to take over Hipgnosis Songs Fund (HSF), the London-listed company that owns Red Hot Chili Peppers’ catalog, because in a revised takeover plan disclosed Monday it is paying less in advisory fees. In a joint announcement, Blackstone and HSF’s board of directors said they approved the offer […]
Concord confirmed on Thursday it will no longer proceed with its $1.51 billion offer to buy Hipgnosis Songs Fund, giving rival bidder Blackstone a now unimpeded path to acquire the Merck Mercuriadis-founded company and its catalogs of the Red Hot Chili Peppers, Journey, Neil Young and others. Explore Explore See latest videos, charts and news […]
