Kobalt will be splashing the cash on music rights once again via a new partnership with investment funds managed by Morgan Stanley Tactical Value. A neat $700 million is on the table to buy up song catalogues over the next few years, with all the rights acquired then set to be managed by the core Kobalt business.
“Kobalt is a pioneer in investing in music, increasing the value of copyrights and creating music as a viable asset class", says Kobalt CEO Laurent Hubert in a statement announcing the new partnership. “Morgan Stanley Tactical Value's trust in Kobalt is a testament to our platform and leadership in the music industry. We are proud to form this unique partnership".
The MD of Morgan Stanley Tactical Value, Cameron Smalls, adds that the investment outfit "has profound respect for songwriters and the immense value of their art. We are THRILLED to partner with the leading creator-first publisher that is a pioneer in maximising royalty collections for songwriters and rightsholders".
"Together with Kobalt’s infrastructure and deep commitment to bettering the music industry", he goes on, "we are excited about our partnership and the opportunities ahead".
Despite the recent wobbles at the Hipgnosis Songs Fund, there remains plenty of interest within investment circles in music rights, including among investors in the publicly-listed Hipgnosis fund.
Kobalt previously capitalised on that interest via its Kobalt Capital business, which set up, advised and subsequently sold two music rights owning funds.
One of those funds was actually sold to Hipgnosis, which is now looking to sell on 20,000 "non-core songs" that came with that deal. An FT report last month suggested that it might be Kobalt that actually buys those rights, though that was before the vote by shareholders last week which has forced a "re-set" within the Hipgnosis Songs Fund.