Company with royalties for pop music catalogues, including Justin Bieber, Shakira is selling $372 million worth of bonds
Backed by Blackstone Incorporated, the company was known as Hipgnosis, before rebranding in March 2025. Around 76 per cent of its catalogue portfolio consists of music released over a decade ago, the report said, citing information from a report by the Kroll Bond Rating Agency. Recognition Music Group is selling $372 million worth of bonds, backed by its royalties.
As part of the proposed bond sale, it also plans to contribute more music assets, independently valued at $340.8 million.
That would bring the total valuation of the collateral being put up to about $2.95 billion, based on expected asset cash flows.
Proceeds from the sale would be used to repay existing debt, help fund reserves and transaction costs, as well as for other general corporate purposes, according to Kroll, which has assigned a preliminary grade of A to the deal's A-2 class.
In recent years, the growing popularity of streaming services has helped bolster royalty cashflows, supporting exotic bonds tied to music assets. Streaming revenue from recorded music swelled to $20.4 billion in 2024, from about $1.8 billion a decade ago, Kroll notes, citing the International Federation of the Phonographic Industry's 2025 Global Music Report.
London-headquartered Recognition has been tapping the song-backed debt market for some time, including as recently as the end of last year, when it sold $1.47 billion of notes. Its inaugural music royalty ABS was in 2022, when it sold $221.65 million of debt.
The business was founded in 2018 by long-time music industry executive Merck Mercuriadis to buy song rights and was later acquired by Blackstone Inc. affiliates in 2021. Mercuriadis had spent decades managing artists like Elton John and Beyonce before founding Hipgnosis.
Barclays Plc is acting as lead bookrunner on Recognition's latest proposed music royalty ABS. The rights in Recognition's music catalog are administered by several organizations, including Sony Music Publishing, Kobalt and Universal Music Publishing Group.
Music royalty ABS volume so far this year is around $1.7 billion, according to data compiled by Bloomberg News.
(With inputs from Bloomberg)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
an hour ago
- Economic Times
EM debt hedge funds play safe amid rally
"It is very hard to predict what they will do next with tariffs, and on top of that you have ongoing wars," Efstathiou said. Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Hedge funds dedicated to emerging-market debt are increasingly turning to risk-mitigating strategies to ensure they lock in double digit gains as a broad rally in developing nation assets a banner first half of the year, hedge funds targeting EM debt have returned nearly 13% on an annual basis-more than their peers positioned in any other asset class, according to data based on Bloomberg latest global financial flows data shows the asset class remains thriving and the extra yield investors demand to hold the sovereign debt of developing nations over US Treasuries just hit a 15-year low. Such tight pricing, along with uncertainty over US policies and global conflicts, is pushing hedge funds to curb risks as they ride the historic rally. The funds do this by swapping longer-maturity bonds in their portfolios for less risky shorter-dated ones. They also focus on higher-rated debt and the most-liquid securities while keeping an ample cash pile."Do you just want to be massively long on credit on these valuations? I'd say probably not," said Anthony Kettle, who co-manages BlueBay Emerging Market Unconstrained Bond Fund with Polina Kurdyavko and Brent David. "Having a little bit of dry powder evidently makes sense, and also running elevated cash levels."To be clear, Kettle said, there's still a "decent environment" to gain additional returns as funds become more selective and can profit from both rising and falling asset prices, unlike index-based investors. The $784-million BlueBay fund has returned 17% over the past 12 have taken advantage of EM inflows stoked by increased interest for alternative assets amid US policy unpredictability, which has also weakened the dollar. While many developing countries have come out of distressed debt levels as sentiment improved, further risks include another Iran-Israel flare up and potential additional increases in US tariffs, including on the buyers of Russian Donald Trump's administration has caused a "breakdown of the traditional safe haven correlations" by shaking up the post-Cold War world order, creating an "unusual and unpredictable" environment, said Demetris Efstathiou, the chief investment officer of Blue Diagonal EM Fixed Income Fund."It is very hard to predict what they will do next with tariffs, and on top of that you have ongoing wars," Efstathiou said.
Time of India
an hour ago
- Time of India
EM debt hedge funds play safe amid rally
"It is very hard to predict what they will do next with tariffs, and on top of that you have ongoing wars," Efstathiou said. Emerging-market debt hedge funds, boasting impressive double-digit returns this year, are strategically mitigating risks amidst a deepening rally. Funds are swapping longer-maturity bonds for shorter-dated ones, prioritizing higher-rated, liquid securities, and increasing cash reserves. This cautious approach addresses uncertainties stemming from US policies, global conflicts, and tight pricing, while still seeking selective opportunities for further gains. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Popular in Markets 1. India's ESG bond market picks up as global and domestic push align: Vineet Agrawal of Jiraaf Hedge funds dedicated to emerging-market debt are increasingly turning to risk-mitigating strategies to ensure they lock in double digit gains as a broad rally in developing nation assets a banner first half of the year, hedge funds targeting EM debt have returned nearly 13% on an annual basis-more than their peers positioned in any other asset class, according to data based on Bloomberg latest global financial flows data shows the asset class remains thriving and the extra yield investors demand to hold the sovereign debt of developing nations over US Treasuries just hit a 15-year low. Such tight pricing, along with uncertainty over US policies and global conflicts, is pushing hedge funds to curb risks as they ride the historic rally. The funds do this by swapping longer-maturity bonds in their portfolios for less risky shorter-dated ones. They also focus on higher-rated debt and the most-liquid securities while keeping an ample cash pile."Do you just want to be massively long on credit on these valuations? I'd say probably not," said Anthony Kettle, who co-manages BlueBay Emerging Market Unconstrained Bond Fund with Polina Kurdyavko and Brent David. "Having a little bit of dry powder evidently makes sense, and also running elevated cash levels."To be clear, Kettle said, there's still a "decent environment" to gain additional returns as funds become more selective and can profit from both rising and falling asset prices, unlike index-based investors. The $784-million BlueBay fund has returned 17% over the past 12 have taken advantage of EM inflows stoked by increased interest for alternative assets amid US policy unpredictability, which has also weakened the dollar. While many developing countries have come out of distressed debt levels as sentiment improved, further risks include another Iran-Israel flare up and potential additional increases in US tariffs, including on the buyers of Russian Donald Trump's administration has caused a "breakdown of the traditional safe haven correlations" by shaking up the post-Cold War world order, creating an "unusual and unpredictable" environment, said Demetris Efstathiou, the chief investment officer of Blue Diagonal EM Fixed Income Fund."It is very hard to predict what they will do next with tariffs, and on top of that you have ongoing wars," Efstathiou said.
Mint
3 hours ago
- Mint
Sabadell CEO Sees Bid for Spanish Banking Powerhouse Deadlocked
(Bloomberg) -- Banco Sabadell SA's chief executive officer said an acquisition offer by BBVA SA remains too low, leaving little prospect for plans to create a Spanish banking powerhouse. 'At this price, it's impossible for this to work,' CEO Cesar Gonzalez-Bueno said in an interview. BBVA, he said, has two options after Sabadell rejected its bid: 'Substantially improve the offer, or withdraw it.' A rise in Sabadell's shares since BBVA made its offer in May 2024 has bolstered Gonzalez-Bueno's defense against the unsolicited bid. That stance also has a measure of support from Prime Minister Pedro Sanchez's government in Madrid. BBVA has offered one newly-issued share and €0.70 in cash for each 5.3456 ordinary shares of Sabadell. That values Sabadell around €13.6 billion, compared with a market value of €15.6 billion. Sabadell shares have risen 70% since news of BBVA's interest broke in April 2024, outpacing its bigger rival's 20% gain and leaving its stock at a 15% premium to the offer price. 'If it wants to acquire Sabadell, we think that BBVA would have to increase the cash component to as much €1.00 per share' of Sabadell, KBW analyst Hugo Cruz said in a note. Paying 1 euro per share would translate into about €5.3 billion, according to Bloomberg calculations. Gonzalez-Bueno hinted at obstacles to a higher offer, echoing BBVA Chairman Carlos Torres' own warning last year that he's hemmed in by the potential impact on BBVA's share price. In its latest defensive move, Sabadell — Spain's fourth-biggest bank by assets — agreed to sell TSB, its UK unit, and pledged to return €6.3 billion ($7.4 billion) to shareholders over three years. The tussle has parallels to Italy, where government resistance tanked UniCredit SpA's unsolicited bid for Banco BPM SpA — a setback for Chief Executive Officer Andrea Orcel's efforts to reshape Europe's financial industry. The European Commission has criticized Italy and Spain for meddling in the deals. While government interventions risk violating European Union rules on the free movement of capital, Gonzalez-Bueno signaled he doesn't see a risk if BBVA's bid succeeds. The transaction as proposed is 'neutral' in that respect, he said. Spain's government has told BBVA, the country's second-biggest bank, that it wouldn't be allowed to fully integrate Sabadell for at least three years if the combination went ahead. Gonzalez-Bueno said the government's condition would reduce the deal's promised synergies to 'zero.' 'It's perfectly reasonable and honorable to change your mind' when a transaction no longer makes sense, Gonzalez-Bueno said. 'I don't think Orcel's prestige has been destroyed' by Unicredit's setback, he added. As part of its defense, Sabadell also held informal talks with Unicaja Banco SA shareholders about a combination. It also explored a potential merger with Abanca, the Expansion newspaper reported. Abanca said it's not interested. While Sabadell is open to mergers with smaller rivals, 'I don't see them in the medium term' as 'there's no appetite,' Gonzalez-Bueno said. In contrast, he said Sabadell is seeking to expand in investment banking, 'to have the market share that corresponds to us.' BBVA, formally known as Banco Bilbao Vizcaya Argentaria SA, is keeping it offer alive despite the government's conditions, saying they will only delay some of the synergies. BBVA's leaders have said they don't intend to boost the bank's offer for Sabadell for now. Sabadell last week announced the payout plan and a more ambitious profitability target along with second-quarter earnings that beat analysts estimates. The payout pledge includes a €2.5 billion extraordinary dividend from the sale of TSB, which is awaiting regulatory approval and signoff by shareholders at a meeting on Aug. 6. 'Ordinary capital creation is our best weapon' against BBVA bid, Gonzalez-Bueno said. More stories like this are available on
