Hipgnosis, a prominent music rights investment and management firm, has announced the completion of a $1.47 billion asset-backed securities (ABS) deal named Lyra 24-2. This marks one of the largest music royalty securitizations to date. The transaction is supported by royalties from Hipgnosis's $2.36 billion music rights portfolio, acquired during the privatization of Hipgnosis Songs Fund (SONG). This extensive portfolio includes 138 catalogues with over 45,000 songs from renowned artists such as Red Hot Chili Peppers, Fleetwood Mac, and Shakira.
Blackstone has been actively investing in music royalties since 2021 and played a significant role in this transaction. MUFG Securities led the structuring process, while Barclays, Goldman Sachs, Fifth Third Securities, and SMBC Nikko acted as joint bookrunners. Blackstone Capital Markets participated as a co-manager.
The issuance attracted 25 investors and is rated A- by KBRA. The proceeds will be used to repay existing debt and support future acquisitions.
Ben Katovsky, CEO of Hipgnosis, stated: “We are delighted to announce the successful completion of our second asset-backed securitisation...This achievement not only reinforces the quality and strength of our music catalogue but also enables us to unlock new opportunities for growth and investment.”
Qasim Abbas from Blackstone added: “This landmark transaction not only highlights the strength of Hipgnosis’ exceptional catalogue but also reflects our capabilities in providing innovative financial solutions in support of their ongoing growth and success.”
FTI Consulting served as backup manager for this transaction with Citibank acting as trustee. Legal counsel was provided by Latham & Watkins for the issuer and Paul Weiss for noteholders.