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(Alliance News) - Hipgnosis Songs Fund Ltd on Monday said it intends to raise GBP250 million through the placing of shares at 116 pence each, and a further 4.2 million through a retail offer at the same price.
The placing price represents a 7.9% discount to the Friday closing price of 126p. Shares in the FTSE 250-listed music catalogue investor were trading 5.0% lower at 119.74 pence each on Monday morning in London, giving it a market capitalisation of GBP758.5 million.
Hipgnosis said it plans to place up to 215.5 million shares to raise GBP250 million, adding that retail investors will also get the chance to buy up to 3.6 million shares through the PrimaryBid platform.
N+1 Singer Advisory LLP, JP Morgan Securities PLC and RBC Capital Markets are acting as joint bookrunners in connection with the placing.
The new cash will be used to fund the acquisition of a significant pipeline of catalogues with a blended acquisition multiple of approximately 18 times the historic annual income.
The company highlighted that the pipeline includes some of the most influential hit songs of each of the past six decades which offer significant song management opportunities and will further diversify the its income by artist, genre and vintage. It added that its investment adviser is also in discussions on further catalogues worth over GBP1 billion.
"We have made a significant impact on the songwriting community over the last two plus years and the overwhelming love and support we have from these great creators has led to further opportunities on evergreen songs and catalogues. I would like to thank all the songwriters, artists and producers that have made us first choice to look after your incomparable legacies," said Merck Mercuriadis, founder of Hipgnosis.
Earlier this month Hipgnosis said it had invested around 82% of the proceeds from its July C Share fundraising. Since then it has purchased several more catalogues including those of Rick James, Steve Robson and The Pretenders band member Chrissie Hynde.
By Ife Taiwo; ifetaiwo@alliancenews.com
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