Big Business: Music Catalog Acquisitions

In recent years, the sale and acquisition of music catalogs has reached more than a billion dollars. A music catalog is known as the collection of musical compositions and the copyrights of those musical compositions. A music catalog encompasses a thorough list of musical compositions and songs created and registered under an individual or entity, such as songwriters or publishers. To sell a music catalog, it needs to be determined who is the owner of the musical compositions and who controls the copyright. Of course, each different owner must agree to the sale. The overall catalog may be sold with other assets, such as a songwriter’s or recording artist’s trademark and name and likeness. There are a few major players that have advantages in the music catalog acquistion space – Sony, Universal, and Warner.

There are benefits to an artist selling their music catalog. When an artist sells their music, they gain the advantage of receiving a specific dollar amount now rather than betting that their royalties will exceed that amount in the future. Taking a lump sum of money combats the uncertainty of what future royalty revenues could be. While the sale of your music catalog is a good way for artist to diversify their incomes, there are tax implications that must be considered when engaging in a potential sale of a music catalog. Additionally, estates of artists have discovered that sales are a lucrative way to manage legacy and inheritance planning.

Here is a list of the largest music catalog acquisitions in history:

• March 2024 - Sony bought a stake in Michael Jackson’s music catalog for $1.2 Billion, which is the largest music catalog acquisition to date.
• December 2021 - Bruce Springsteen sole his music catalog for $500 Million to Sony. The agreement included Springsteen’s recordings and his songwriting rights. The deal gave Sony complete rights over songs such as ‘Born in the USA,’ ‘The River,’ or ‘Born to Run.
• December 2020 – Universal announced that it had purchased Bob Dylan’s entire publishing catalog, encompassing more than 600 copyrights for $300 million. Following that, in January 2022, Sony announced that it had acquired Dylan’s entire back catalog of recorded music, as well as the rights to multiple future new releases for $200 million.
• September 2022 - Concord Music Group Inc., disclosed that it had purchased the publishing copyrights and a mix of recorded music masters and income streams from Genesis bandmates Phil Collins, Mike Rutherford and Tony Banks. The deal included the trio’s solo publishing and recorded music catalogs as well as the catalog from their Genesis years. It was valued at over $300 million.
• February 2022 - Universal said it had purchased the entirety of British singer-songwriter Sting’s works as a solo artist and as a member of the Police. The deal covered the publishing rights and future royalties for Sting’s more than 600 songs, at a price tag the New York Times estimated to be $300 million. Notably, the deal price excluded Sting’s recorded music catalog.
• January 2022 - Warner Chappell Music bought the publishing rights to David Bowie’s works for a reported $250 million. The deal included publishing rights for hit singles like ‘Heroes,’ ‘Space Oddity,’ ‘Let’s Dance,’ ‘Ziggy Stardust,’ and ‘Under Pressure.’ Besides the rights for all the 26 studio albums released by Bowie during his career, the deal also included rights for his earlier work.
• September 2023 - Litmus Music announced that it had agreed to a “creative partnership” with Katy Perry covering all five of Perry’s studio albums released by Capitol Records between 2008 and 2020. According to Variety and other outlets, Perry had sold her stakes in both the master recordings and the publishing rights to the songs on the albums for $225 million. The Perry catalog includes hits ‘California Girls,’ ‘Firework,’ ‘Roar’ and ‘I Kissed a Girl,’ the song that brought Perry global fame and notoriety.
• January 2023 - Hipgnosis Song Management said that it had acquired all of Canadian pop star Justin Bieber’s publishing rights and master recordings, making up over 290 titles released before December 31, 2021. The deal also included certain public performance-related royalties. Billboard estimated that the price tag was just north of $200 million.

Here is a list of music catalog acquisitions less than $80 million:

• September 2022 - Influence Media acquired Future’s publishing catalog for an estimated $75 million. The eight-figure acquisition includes 612 tracks released between 2004 and 2020 like ‘Mask Off’ and Drake collaborations ‘Jumpman’ and ‘Life Is Good.’
• March 2023 - Atlanta producer Metro Boomin sold a percentage of his catalog to Shamrock Capital for $70 million. His catalog includes songs such as, Migos’ ‘Bad and Boujee’ and Future and Drake’s ‘Jumpman.’
• July 2023 - Nelly sold 50% stake in his catalog to Harbour View Equity Partners for $50 million. The deal includes some of his best-known tracks, including ‘Ride Wit Me,’ ‘Dilemma’ and ‘Hot in Herre.’
• October 2021 - Primary Wave acquired a stake in Luther Vandross’s publishing, master recording income stream, and name and likeness rights. That deal was in the $40 million range.
• December 2021 - Primary Wave Music acquired the assets of the James Brown estate, including music rights, real estate and the control over his name and likeness, for around $90 million. Primary Wave also continued a partnership with the Brown estate, which included several projects related to The James Brown 2000 Trust, which was established in 2000 by Brown for charitable and educational purposes.

As shown above, music catalog acquisitions has become big business not only in the entertainment space, but in the space of acquisitions as a whole. It is likely that companies will continue to be interested in acquiring music catalogs, and name and likeness of artists. It will be interesting to see if additional major players emerge in this space.