Hipgnosis' bidding war intensifies as Concord hikes offer for Shakira music owner (updated)

Hipgnosis Songs Fund

25/04/2024 09:35

(Adds Blackstone's response in paragraph 5, detail on
shareholder support in paragraphs 10-11)
       April 25 (Reuters) - Shares of Hipgnosis Songs Fund
 SONG.L  climbed on Thursday after Apollo-backed Concord outbid
a proposal by private equity giant Blackstone  BX.N , launching
a bidding war for the owner of music rights of artists,
including Shakira and Blondie.
    Concord, a Nashville-based independent music company,
sweetened its bid late on Wednesday for Hipgnosis to $1.25 per
share, or about $1.51 billion, slightly higher than Blackstone's
proposal of $1.24 apiece.
    Shares of Hipgnosis were up 1.1% at 1.028 pounds ($1.28) as
the fresh offer fuelled prospects of a higher counter-bid from
the world's largest private equity firm.
    Concord had last week agreed to buy the music rights
investment fund at $1.16 apiece, before Blackstone outbid it
over the weekend.
    Blackstone said on Thursday it was considering its options
and asked shareholders not to take any action on Concord's new
bid. 
    While Concord's offer is a formal one and has been backed by
the Hipgnosis board, Blackstone has yet to table a firm bid or
announce its intention to make a formal offer as per takeover
rules in the UK. 
    Blackstone is a majority shareholder in Hipgnosis'
investment adviser, HSM, which manages artists and songwriters
for the fund and holds a call option to make a higher offer for
Hipgnosis' portfolio if their advisory agreement were to be
terminated.
    The Blackstone proposal is independent of HSM.
    Hipgnosis, founded by industry veteran and ex-CEO Merck
Mercuriadis in 2018, started a strategic review last year after
a shareholder vote against the continuation of the fund led to a
tumultuous period and a dispute with HSM over the call option. 
    Concord said Hipgnosis' third-biggest shareholder CCLA
Investment Management has agreed to sell its stake of about 4.8%
to Concord at $1.25 per share by May 8.
    Concord will have the backing of shareholders representing
about 20.7% of Hipgnosis shares after the stake sale.           
       
    ($1 = 0.8004 pounds)

 (Reporting by Yadarisa Shabong in Bengaluru; Editing by Sherry
Jacob-Phillips and Sohini Goswami)
 ((Yadarisa.Shabong@thomsonreuters.com; +91 9742735150;))