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Hipgnosis Songs Fund Ltd - London-based music royalty investment company - Raises gross proceeds of GBP75 million through placing, subscription and intermediaries offer. Hipgnosis placed 62.0 million shares at 121 pence each, and notes directors Andrew Wilkinson and Sylvia Coleman took part in the placing. Following admission of the new shares, Hipgnosis will have 1.07 billion shares in issue.
Hipgnosis previously notes placing will fund more music catalogues and has recently bought record producer and mixer Bob Rock's catalogue for an undisclosed amount. Rock's producer rights comprise 43 songs, including some of the records made by US heavy metal band Metallica and Canadian pop singer Michael Buble.
Chair Merck Mercuriadis says: "2020 was a transformational year for Hipgnosis. Against one of the most challenging economic backdrops of our lives, we raised more capital than any other listed investment fund, outperformed the FTSE 250 index by 22% and paid a fully covered dividend of over 5 pence per share, which places us as the 35th highest dividend yielding company on the FTSE 250. Whilst we would not have wished for a pandemic to prove our thesis that music is a highly investable asset class generating uncorrelated returns, it has done exactly that. In just over two years from IPO to our latest results announcement as at 30 September 2020, we have generated a total NAV return of 38% for our shareholders, a 40% outperformance of the FTSE 250 over the same period.
"That momentum continues, and 2021 is off to our strongest start ever, with some of the most important catalogue acquisitions we have made to date being announced. The new prospectus underpins our plans for marketing into new audiences and fundraising for the rest of the year and I'm delighted with the excellent first step we have made with a successful raise of GBP75 million, over USD100 million. Once again, I am incredibly appreciative of the support from both our existing and new shareholders and equally the incredible songwriters who have entrusted us with their iconic songs. We look forward to investing further into our pipeline of proven and culturally important songs and actively managing these incredible songs to enhance their legacy and maximise income as we seek to provide exceptional risk adjusted returns for shareholders. To top it off we have both the Number 1 and Number 2 airplay songs in the UK this week with Miley Cyrus featuring Dua Lipa and Justin Bieber respectively, both written by our songwriter Stefan Johnson."
Current stock price: 121.00 pence
Year-to-date change: down 2.0%
By Paul McGowan; paulmcgowan@alliancenews.com
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