The board of the Hipgnosis Songs Fund said on Monday it would support a takeover bid from Blackstone if the private equity giant formally files its $1.5 billion bid for the music rights fund.
Blackstone said on Saturday (April 20) in what it called a “potential offer” that it was willing to offer $1.24 per share, or about $1.5 billion, in all cash for the troubled music rights fund, which represents an 8.7% premium over the stock's last closing price. Blackstone's offer comes two days after Nashville-based Concord Music offered $1.4 billion.
The London-listed fund, which owns rights to songs by Neil Young, Journey, Lindsey Buckingham, Blondie and other artists, saw its share price fall as the value of its portfolio fell and investors' dividends fell. By saying it would support the highest bid on Monday, the board appeared to signal to shareholders that it would take the fastest route to get them the highest return.
“The Board of Directors, after reviewing the Proposal with its financial advisor … has indicated to Blackstone that the Proposal has value that it would be willing to propose to its shareholders if Blackstone announces a firm intention to make an offer,” the board of directors of Hipgnosis Songs Fund. of the directors listed in the filing.
The board was careful to say that it was not certain that Blackstone would make a formal offer, but said it would “continue to provide Blackstone and its advisors with access to confirmatory due diligence, to enable Blackstone to announce a firm intention to an offer, as soon as possible,” he said.
Until then, Hipgnosis' directors continue to unanimously recommend Concord's offer to shareholders.
Any deal requires a three-quarters majority of shareholder support. Last week, the board and institutional investors representing 30% of the fund's outstanding shares said they supported Concord's bid.
That proposed deal, made public on Thursday (April 18), valued each Hipgnosis share at £0.93 ($1.14), a premium of about a third to the fund's previous day's closing price.
from our partners at https://www.billboard.com/business/business-news/hignosis-board-blackstone-possible-takeover-bid-over-concord-1235662291/