(Reuters) – Shares of Hipgnosis Songs Fund climbed on Thursday after Apollo-backed Concord outbid a proposal by private equity giant Blackstone (NYSE:), launching a bidding war for the owner of music rights of artists including Shakira and Blondie.
Concord, a Nashville-based independent music company, late on Wednesday sweetened its bid for Hipgnosis to $1.25 per share, or about $1.51 billion, slightly higher than Blackstone’s proposal of $1.24 apiece.
Shares of Hipgnosis were up 1.1% at 1.028 pounds ($1.28), as the fresh offer fuels the prospect of a higher counter-bid from the world’s largest private equity firm.
Concord had last week agreed to buy the music rights investment fund at $1.16 apiece, before Blackstone outbid it over the weekend.
While Concord’s offer is a formal one, Blackstone has yet to table a firm bid or announce its intention to make a formal offer as per takeover rules in the UK.
Blackstone is also a majority shareholder in Hipgnosis’ investment adviser, Hipgnosis Songs Management (HSM), which manages artists and songwriters for the fund and holds a call option to make a higher offer for Hipgnosis’ portfolio of songs if their investment advisory agreement was terminated.
The Blackstone proposal, however, is independent of HSM.
The takeover battle for Hipgnosis comes as the fund, founded by industry veteran and ex-CEO Merck Mercuriadis in 2018, started a strategic review last year after a shareholder vote against the continuation of the fund led to a board overhaul, a portfolio revaluation, and a dispute with HSM over the call option.
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($1 = 0.8004 pounds)
