REG - Hipgnosis Songs Fund - Update on CRB III impact and dividend payment

Hipgnosis Songs FundAnnouncement

16/10/2023 07:15

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RNS Number : 2081Q  Hipgnosis Songs Fund Limited  16 October 2023

This announcement contains inside information for the purposes of the UK
Market Abuse Regulation.

LEI: 213800XJIPNDVKXMOC11

Hipgnosis Songs Fund Limited ("Hipgnosis" or the "Company")

Update on CRB III retroactive payments and withdrawal of October interim
dividend payment

16 October 2023

The Board of Hipgnosis Songs Fund Limited announces that it was notified on 13
October 2023 that Citrin Cooperman, the Company's Independent Portfolio
Valuer, has materially reduced its expectations of industry-wide retroactive
payments in relation to the U.S. Copyright Royalty Board's  decision in
relation to royalties payable to songwriters for the period covering 2018-2022
("CRB III") for its valuation of the Company's portfolio as at 30 September
2023. As a result, the Board now expects to receive significantly lower
retroactive payments in relation to CRB III and therefore intends to reduce
its CRB III retroactive accrual to $9.9m, from $21.7m as at 31 March 2023.

Accordingly, in consequence of this unwinding of the CRB III accrual, the
Board has decided to withdraw the proposed interim dividend of 1.1325 pence
per share announced on 21 September 2023 in order to ensure compliance with
its revolving credit facility's Fixed Charge Cover Ratio covenant.

In addition, the Company is in discussion with the agent and the lenders to
avoid any potential impacts of the unwinding of the CRB III accrual on future
Fixed Charge Cover Ratio covenant compliance.

Subject to satisfactory conclusion to discussions with lenders, the Board
expects to declare and pay future dividends as targeted. A further
announcement will be made in due course.

The person responsible for making this notification is Andrew Sutch, Chairman
of Hipgnosis Songs Fund Limited.

For more information:

For further information please contact:

 Hipgnosis Song Management

 Merck Mercuriadis

 Ben Katovsky

 Rufina Pavry                                                +44 (0)20 4542 1511

 Giles Croot                                                 +44 (0)20 4542 1530
 Singer Capital Markets - Joint Corporate Broker

 James Moat / Angus Campbell (Corporate Finance)             +44 (0)20 7496 3000

 Alan Geeves / James Waterlow / Sam Greatrex (Sales)
 J.P. Morgan Cazenove - Joint Corporate Broker

 William Simmonds / Jérémie Birnbaum (Corporate Finance)     +44 (0)20 3493 8000

 James Bouverat (Sales)
 RBC Capital Markets - Joint Corporate Broker

 Elliot Thomas / Max Avison (Corporate Finance)              +44 (0)20 7635 4000

 Lisa Tugwell / Natalia Lipecka (Sales)
 Ocorian - Company Secretary & Administrator

 Lorna Zimny                                                 +44 (0) 28 9693 0222
 The Outside Organisation

 Alan Edwards / Nick Caley                                   +44 (0)7711 081 843
 Headland Consultancy

 Susanna Voyle / Del Jones / Charlie Twigg                   +44 (0) 20 3805 4822
 All US music publicity enquiries

 Fran Defeo                                                  +1 917 767 5255

Notes to Editors

About Hipgnosis Songs Fund

Hipgnosis Songs Fund, which was founded by Merck Mercuriadis, is a Guernsey
registered investment company established to offer investors a pure-play
exposure to songs and associated musical intellectual property
rights. In March 2020 the Company became a constituent of the FTSE 250
Index. The Company is recognised as an investment trust under applicable HMRC
regulations.

About Hipgnosis Song Management Limited

 

The Hipgnosis Songs Fund's Investment Adviser is Hipgnosis Song Management
Limited, which was founded by Merck Mercuriadis, former manager of globally
successful recording artists, such as Elton John, Guns N' Roses, Morrissey,
Iron Maiden and Beyoncé, and hit songwriters such as Diane Warren, Justin
Tranter and The-Dream, and former CEO of The Sanctuary Group plc. The
Investment Adviser has assembled an Advisory Board of highly successful
music industry experts which include award winning members of the artist,
songwriter, publishing, legal, financial, recorded music and music management
communities, all with in-depth knowledge of music publishing. Members
of Hipgnosis Song Management Limited Advisory Board include Nile Rodgers,
The-Dream, Giorgio Tuinfort, Starrah, David A. Stewart, Poo Bear, Bill
Leibowitz, Ian Montone and Rodney Jerkins.

 

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