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Justin Bieber sells music rights for $200m

Pop star sold his music publishing and recording catalogue shares to Hipgnosis Songs Capital, the company said.

Gifty Okoampah by Gifty Okoampah
January 25, 2023
in Entertainment, International, News, World News
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Pop juggernaut Justin Bieber has sold his music publishing and recording catalogue shares to the Blackstone-backed Hipgnosis Songs Capital for $200m, the company said, marking the industry’s latest blockbuster rights deal.

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The sale has been rumoured for weeks and sees the 28-year-old join a who’s who of artists who have cashed out recently on their catalogues.

Hipgnosis did not publicly disclose the terms of the deal, but a source close to the matter told AFP news agency it was worth about $200m.

“The impact of Justin Bieber on global culture over the last 14 years has truly been remarkable,” Hipgnosis chief Merck Mercuriadis, a longtime music industry executive, said in a statement on Tuesday.

“At only 28 years of age, he is one of a handful of defining artists of the streaming era that has revitalised the entire music industry, taking a loyal and worldwide audience with him on a journey from teen phenomenon to culturally important artist.”

Hipgnosis Songs Capital is a $1bn venture between financial giant Blackstone and the British Hipgnosis Song Management. Hipgnosis said they acquired Bieber’s interest in his publishing copyrights to his 290-song back catalogue – all of his music released prior to December 31, 2021.

Bieber’s longtime home Universal will continue to administer the catalogue, another source close to the deal said, and still owns the artist’s master recordings. Hipgnosis has acquired the artist’s stake in his masters as well as his neighbouring rights – a royalty that sees its owner receive a payment every time a song is played publicly.

Contemporary stars, including Justin Timberlake and Shakira, have sold large stakes in their work – both also struck deals with Hipgnosis – but the move has mostly been seen among legacy artists like Bob Dylan and Bruce Springsteen.

The staggering sums – Springsteen’s catalogue went to Sony for a reported $500bn – are considered safe bets both for older artists getting their finances in order and investors who can count on consistent returns from time-tested music and the viability of streaming.

Younger catalogues are seen as riskier territory, but Bieber is among the best-selling artists ever, and now Hipgnosis has his share in some of the 21st century’s biggest hits, including Baby and Sorry.

After the Canadian native was discovered on YouTube as a teen, Bieber skyrocketed to global fame, selling more than 150 million records.

He has charted eight number-one records on Billboard’s top albums list, and his songs have streamed on Spotify alone more than 32 billion times.

Bieber’s health has suffered recently, with the singer going on an indefinite touring hiatus after he revealed he had been diagnosed with Ramsay Hunt syndrome, a rare complication of shingles that for him caused partial facial paralysis.

Music catalogues have always changed hands, but the current publishing sales boom had escalated rapidly, with financial markets increasingly drawn to lucrative music portfolios as an asset class.

Mercuriadis’s Hipgnosis, which went public on the London Stock Exchange in 2018, has played a large part in publicising the spike in sales.

The sector had seemed to cool recently, but the Bieber deal shows investors are still hungry for music acquisitions.

Owners of a song’s publishing rights receive a cut in various scenarios, including radio play and streaming, album sales, and use in advertising and movies. Recording rights govern reproduction and distribution.

The flurry of sales came amid a wider conversation over artists’ ownership of the work, amplified in large part by Taylor Swift, who has found resounding success as she re-records her first six albums so she can control their master recording rights.

That move stemmed from Swift’s very public feud with Scooter Braun, the music manager whose company once owned her original masters, and later sold them to the investment firm Shamrock Holdings.

Braun, Bieber’s manager for 15 years, said in a statement, “When Justin made the decision to make a catalogue deal we quickly found the best partner to preserve and grow this amazing legacy was Merck and Hipgnosis.”

“Justin is truly a once in a generation artist and that is reflected and acknowledged by the magnitude of this deal.”

SOURCE: AFP

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