Punk icon: Blondie’s Debbie Harry sold song rights to Hipgnosis
Hipgnosis Songs Fund faced fresh backlash last night when one of its major shareholders rejected its “desperate” attempts to transform its fortunes.
The embattled music rights firm run by Beyoncé’s former manager Merck Mercuriadis said it was launching a “strategic review” ahead of a decisive vote on its future.
Next Thursday, investors will vote on plans to sell 29 catalogs to a Blackstone fund also managed by Mercuriadis.
Critics are concerned that the £362m price tag for hits, including songs by Shakira and Rick James, is too low and will not provide the best value for shareholders.
Hipgnosis said yesterday that it will consider “all options” for its future, including how it is managed.
But Tom Treanor of Asset Value Investors, who has a 5 per cent stake, attacked the group’s “desperate stuff”.
“The deal is still terrible and voting in favor would still set a terrible precedent for future asset sales,” he said. “I can’t think of anyone worse qualified to conduct a strategic review than this board.”
Asset Value has called for a board review, rejecting a second “continuation” vote that shareholders will also hold next week.
Analysts at Jefferies said: “We view the initiation of a strategic review as a last-ditch, and ultimately unsuccessful, attempt to influence shareholders ahead of next week’s crucial general meetings.”
Founded in 2018, Hipgnosis offers investors the opportunity to make money from royalties from songs by famous artists.
His fund now owns the rights to 65,000 songs.
He made a name for himself by collecting the music of some of the world’s best-known musicians, from Kaiser Chiefs to Blondie.
But it has failed to maintain momentum and investors are unhappy with returns.
Stocks fell to a record low on Monday on news that it would eliminate its dividend, warning that U.S. profits would not be as lucrative as it had hoped.
But the stock rose 4.1 per cent, or 3p, to 76p yesterday.
