Joins with Dundee Partners to form long-term
strategic partnership for management and acquisition of world-class
music IP
UMG to globally administer publishing and
distribute recordings for Chord's existing catalogs, with more than
60,000 music copyrights
KKR to sell its majority stake in Chord to
current shareholder Dundee Partners and its investor consortium
with a minority stake held by UMG
SANTA MONICA, Calif.
and HILVERSUM, The
Netherlands, Feb. 20, 2024
/PRNewswire/ -- Universal Music Group (UMG), the world-leader in
music-based entertainment, and Dundee Partners, the investment
office of the Hendel family, today announced that UMG will acquire
a 25.8% interest in Chord Music Partners (Chord) for US$240 million (approximately €223 million when
translated into € at today's current EUR/USD rate), in a deal that
values Chord at US$1.85 billion.
Chord, which was formed in 2021 by KKR and Dundee Partners, is a
pure-play catalog of premier music intellectual property (IP).
Chord's portfolio includes works from many of the world's most
iconic artists and songwriters, including The Weeknd, Ryan Tedder/OneRepublic, David Guetta, Lorde, Kid Cudi, Diplo, Jimmy Jam
& Terry Lewis, Ellie Goulding, ZZ Top, John Legend, Twenty One
Pilots and many more.
UMG and Dundee Partners will enter into a new long-term
strategic partnership to actively manage Chord's rights through
UMG's global network and to acquire additional catalogs via Chord
in the future. Chord's music publishing rights will be administered
through Universal Music Publishing Group (UMPG) and recorded music
through UMG's Virgin Music Group (VMG).
Sir Lucian Grainge, Chairman and
CEO of Universal Music Group said, "Finding partners who share our
passion for identifying iconic songs and recordings that will stand
the test of time and deliver long-term growth is essential, which
is why we're so pleased to be working with Stephen and Sam Hendel and Dundee
Partners. With the leadership of Jody
Gerson at UMPG, Nat Pastor
and JT Myers at Virgin, and the support of our experienced creative
executives around the world, no one can do more with music
rights than our teams. We look forward to creating maximum
commercial and creative value for the songwriters and artists in
Chord and building for the future."
Boyd Muir, Universal Music
Group's Executive Vice President, Chief Financial Officer and
President of Operations said: "We're excited to partner with the
Hendel family in Chord for a number of reasons. First, KKR and
Dundee have built a very high-quality catalog that will benefit
from our first-rate management and global capabilities. Second,
this new structure provides us with an efficient vehicle for future
catalog acquisitions, without significant capital allocation
through a combination of leverage and partner equity
capital. And finally, it offers us the perfect partner to
approach future growth opportunistically and flexibly, one who is
equally bullish on the long-term prospects for music."
Sam Hendel, Dundee Partners'
Managing Principal and Co-Founder of Chord, said:
"We're thrilled to be partnering with Universal Music Group
and embarking on this next exciting chapter for Chord. By
combining a best-in-class financial acquisition vehicle with the
world's leading music company, we are creating both a premier
platform for music investment as well as a permanent home for
premier artist's legacies and their iconic cultural works.
We'd like to thank the team at KKR for their partnership and
creating a strong foundation for Chord and its future
success."
"We are grateful to have had the opportunity to collaborate with
many leading artists and to create significant value for our
investors by building Chord into a differentiated and scaled
portfolio. We believe that Dundee and UMG will drive further value
creation for artists and that they share our commitment to being
respectful stewards of artists' music," said Jenny Box, Partner, KKR.
KKR will exit Chord upon completion of the transaction, with the
Dundee consortium and UMG owning 74.2% and 25.8%
respectively.
As a leader in music-based entertainment, UMG is positioned and
resourced to manage and drive growth for Chord's existing rights
catalogs, while UMG and Dundee Partners are both aligned in their
long-term vision for the acquisition, management and growth
opportunities for significant, timeless music-rights catalogs.
UMG was advised by Goldman Sachs, Kirkland & Ellis LLP and
Freshfields. DLA Piper and Axinn, Veltrop & Harkrider LLP
served as legal advisors to Dundee. Fifth Third Bank, National
Association served as financial advisor and provided committed
financing to Dundee and UMG. The Raine Group served as exclusive
financial advisor and Manatt, Phelps and Phillips, LLP served as
legal advisor to Chord Music Partners. Latham & Watkins LLP.
served as legal counsel to KKR.
About Universal Music Group
At Universal Music Group,
we exist to shape culture through the power of artistry.
UMG is the world leader in music-based entertainment, with a
broad array of businesses engaged in recorded music, music
publishing, merchandising, and audiovisual content. Featuring the
most comprehensive catalogue of recordings and songs across every
musical genre, UMG identifies and develops artists and
produces and distributes the most critically acclaimed and
commercially successful music in the world. Committed to artistry,
innovation, and entrepreneurship, UMG fosters the development
of services, platforms, and business models in order to broaden
artistic and commercial opportunities for our artists and create
new experiences for fans. For more information, visit
www.universalmusic.com.
About Dundee Partners
Dundee Partners is the
investment office of the Hendel family and has a long history
of unwavering dedication to the promotion of arts and culture. The
family is proud of its decades-long support for theater and notably
were lead producers of the Broadway hit "Fela!". In addition to
co-founding Chord Music Partners, Dundee is the majority owner of
Knitting Factory Entertainment, Partisan Records, and Kino Lorber.
Beyond those endeavors, the family continues to make strategic
investments at the intersection of music and technology, shaping
industry and cultural evolution.
About KKR
KKR is a leading global investment firm
that offers alternative asset management as well as capital markets
and insurance solutions. KKR aims to generate attractive
investment returns by following a patient and disciplined
investment approach, employing world-class people, and supporting
growth in its portfolio companies and communities.
KKR sponsors investment funds that invest in private equity,
credit and real assets and has strategic partners that manage hedge
funds. KKR's insurance subsidiaries offer retirement, life and
reinsurance products under the management of Global Atlantic
Financial Group. References to KKR's investments may include
the activities of its sponsored funds and insurance subsidiaries.
For additional information about KKR & Co.
Inc. (NYSE: KKR), please visit KKR's website
at www.kkr.com. For additional information
about Global Atlantic Financial Group, please visit Global
Atlantic Financial Group's website
at www.globalatlantic.com.
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