KKR and BMG Join Music-Bidding Wars After Deals by Dylan, Nicks
(Bloomberg) -- Private equity firm KKR and music company BMG Rights Management GmbH are teaming up to acquire song catalogs, following blockbuster deals by artists such as Bob Dylan, Stevie Nicks and Neil Young.
The two parties will search for deals together and can invest as each side sees fit, according to a statement Wednesday. The firms didn’t disclose the financial terms of their arrangement, which they are dubbing an alliance. KKR isn’t buying a stake in BMG, nor did the two form a joint venture or fund.
The value of music rights has soared in recent years, buoyed by the growth of streaming services, as well as low interest rates and financial firms’ interest in alternative assets. The London-based Hipgnosis Songs Fund has spent close to $2 billion alone in the market.
KKR announced a deal earlier this year to buy a stake in OneRepublic frontman Ryan Tedder’s catalog, valuing his nearly 500 songs at $200 million.
BMG has largely sat out the recent boom in song rights, having already completed more than 100 deals between 2009 and 2017. But the latest frenzy has been hard to ignore. In December, the 79-year-old Dylan sold his entire songwriting catalog to Universal Music Group Inc. for more than $300 million.
KKR owned a majority stake in BMG between 2009 and 2013, and funded many of the acquisitions that created the company in its current form. BMG is now owned by Germany’s Bertelsmann SE and operates a music publisher and record label that owns rights to songs by the Rolling Stones, Lenny Kravitz and Kylie Minogue.
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