mjzee Posted June 3, 2021 Report Share Posted June 3, 2021 From WSJ: Breaking News... Hedge-fund billionaire William Ackman’s special-purpose acquisition company is nearing a transaction with Universal Music Group that would value the world’s largest music business at about $40 billion, people familiar with the matter said. The deal would be the largest SPAC transaction on record, exceeding the roughly $35 billion that Singaporean ride-hailing company Grab Holdings Inc. was valued at in a similar deal recently, according to Dealogic. It would have a so-called enterprise value, taking into consideration Universal’s debt, of about $42 billion. It’s not guaranteed Universal and the SPAC, Pershing Square Tontine Holdings Ltd. will reach a deal. If they do, it could be finalized in the next few weeks and isn’t subject to any additional due diligence, the people said. Quote Link to comment Share on other sites More sharing options...
GA Russell Posted June 4, 2021 Report Share Posted June 4, 2021 To what extent did the destruction from the Universal fire diminish Universal's 2021 value? Is that music too old for many people to care? Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 They just bought Dylan, right? Sounds like a flip to me. Quote Link to comment Share on other sites More sharing options...
Brad Posted June 4, 2021 Report Share Posted June 4, 2021 14 hours ago, mjzee said: From WSJ: Breaking News... Hedge-fund billionaire William Ackman’s special-purpose acquisition company is nearing a transaction with Universal Music Group that would value the world’s largest music business at about $40 billion, people familiar with the matter said. The deal would be the largest SPAC transaction on record, exceeding the roughly $35 billion that Singaporean ride-hailing company Grab Holdings Inc. was valued at in a similar deal recently, according to Dealogic. It would have a so-called enterprise value, taking into consideration Universal’s debt, of about $42 billion. It’s not guaranteed Universal and the SPAC, Pershing Square Tontine Holdings Ltd. will reach a deal. If they do, it could be finalized in the next few weeks and isn’t subject to any additional due diligence, the people said. The transaction is only for 10% of Universal. When Vivendi (80% owner of Universal) takes Universal public, which it was planning to do, Aikman’s SPAC would own 10% of the publicly registered company. Quote Link to comment Share on other sites More sharing options...
Dub Modal Posted June 4, 2021 Report Share Posted June 4, 2021 SPACs are completely soulless. Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 Ted Gioia seems to think that this is a suckers' game over the long haul. https://tedgioia.substack.com/p/why-are-investment-funds-obsessed But the days of long game...good luck on that! Quote Link to comment Share on other sites More sharing options...
Dub Modal Posted June 4, 2021 Report Share Posted June 4, 2021 Interesting Gioia piece. Looks like he has an MBA per one of the commenters. I didn't see where he talked about the tax benefits of declining assets, but that's a consideration of these deals and why they would hold them on the books. The current trend among PE firms was actually longer holds, but SPACs are different - just investment shells. So short term gains based on certain parts of that Universal catalog (licensing, etc.) could be countered by the tax shelter a declining asset gives them. Such a game. Quote Link to comment Share on other sites More sharing options...
bertrand Posted June 4, 2021 Report Share Posted June 4, 2021 What would happen to Impulse and Blue Note? I am worried this can be another Concord type of fiasco. Did we ever figure out what their game was? Obviously, they have no respect for the music. Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 Would the "declining assets" game actually incentivize locking up the catalogs from market availability? Like,, they're not going to let any of this out because if they did, it might increase value? Or is that too simplistic? Quote Link to comment Share on other sites More sharing options...
Dub Modal Posted June 4, 2021 Report Share Posted June 4, 2021 (edited) 6 minutes ago, JSngry said: Would the "declining assets" game actually incentivize locking up the catalogs from market availability? Like,, they're not going to let any of this out because if they did, it might increase value? Or is that too simplistic? Not sure. If you take the asset as a whole, then it naturally depreciates. Pieces of that whole could have periodic surges in value, but would they actually slow that depreciation or increase the overall value of the entire asset? I'm betting it would just slow depreciation overall, but that can be gamed as well. I'm still thinking they would counter any gains made on licensing pieces of that whole with the tax shelter provided by the overall depreciation. Those strategies can be intricate. I'm thinking there's immense value in licensing a certain percentage of that catalog, but not for reissues so much as advertising. Since there's a complete void of soul in a SPAC, they're not going to care which widget is going to win a gain, just that there's a gain to be had. What little I know about the Concord deal seems to be that they just use that asset deprecation as a tax shelter and that's all they want to do. This may be different, and likely will be, due to the aggressive profit motives of PE and SPAC entities. Edited June 4, 2021 by Dub Modal Quote Link to comment Share on other sites More sharing options...
Brad Posted June 4, 2021 Report Share Posted June 4, 2021 55 minutes ago, bertrand said: What would happen to Impulse and Blue Note? I am worried this can be another Concord type of fiasco. Did we ever figure out what their game was? Obviously, they have no respect for the music. It’s only for 10% of the company. It’s also not clear the transaction will be consummated. Quote Link to comment Share on other sites More sharing options...
Dub Modal Posted June 4, 2021 Report Share Posted June 4, 2021 10% ownership can be considered "significant" Quote Link to comment Share on other sites More sharing options...
felser Posted June 4, 2021 Report Share Posted June 4, 2021 2 hours ago, bertrand said: What would happen to Impulse and Blue Note? I am worried this can be another Concord type of fiasco. Did we ever figure out what their game was? Obviously, they have no respect for the music. Can't wait to see "Tyrone Washington Plays for Lovers". Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 When do we get a "Plays For Players" series? For when everybody who thought they had a lover found out that they had just been getting gamed? Or knew all along that they were gaming? Quote Link to comment Share on other sites More sharing options...
Joe Posted June 4, 2021 Report Share Posted June 4, 2021 2 hours ago, JSngry said: When do we get a "Plays For Players" series? For when everybody who thought they had a lover found out that they had just been getting gamed? Or knew all along that they were gaming? Wasn't that what the "Music Minus One" LPs were (kinda sorta) hinting at? Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 not THAT kind of player! Playa, to use the contemporaneous spelling. Quote Link to comment Share on other sites More sharing options...
bertrand Posted June 4, 2021 Report Share Posted June 4, 2021 (edited) 5 hours ago, Dub Modal said: Not sure. If you take the asset as a whole, then it naturally depreciates. Pieces of that whole could have periodic surges in value, but would they actually slow that depreciation or increase the overall value of the entire asset? I'm betting it would just slow depreciation overall, but that can be gamed as well. I'm still thinking they would counter any gains made on licensing pieces of that whole with the tax shelter provided by the overall depreciation. Those strategies can be intricate. I'm thinking there's immense value in licensing a certain percentage of that catalog, but not for reissues so much as advertising. Since there's a complete void of soul in a SPAC, they're not going to care which widget is going to win a gain, just that there's a gain to be had. What little I know about the Concord deal seems to be that they just use that asset deprecation as a tax shelter and that's all they want to do. This may be different, and likely will be, due to the aggressive profit motives of PE and SPAC entities. I still don't get Concord's angle. Edited June 4, 2021 by bertrand Quote Link to comment Share on other sites More sharing options...
Dub Modal Posted June 4, 2021 Report Share Posted June 4, 2021 10 minutes ago, bertrand said: I still don't get Concord's angle. Looks like they're ultimately owned by Concord Bicycle Music now (as of '19). It gets confusing in terms of who owns/operates that entity. But as of now, Concord Records - as subsidiary of Concord Bicycle - owns 100% of Fania, Fantasy, Razor & Tie, Rounder & Sugar Hill, Savoy, Tams-Witmark, Telarc, Varese Sarabande, Victory, Wind Up, & Musart among others. If anyone can make heads or tails of Concord Bicycle, have at it. It looks to me as if Concord Music might be used as an investment shell by Concord Bicycle. I say that b/c Concord Music went in with a bunch of other companies to invest in Quiyer, Inc. That appears to be some social media platform. If you read between the lines here, reissuing the back catalog isn't likely on anyone's mind at any of these companies. " Concord Music Group, Inc. engages in the development, management, and acquisition of sound recordings, music publishing, and theatrical performance rights. The company offers music labels, including Concord Records, Fantasy Records, Fearless Records, Loma Vista Recordings, and Rounder Records, records music. It also manages KIDZ BOP label and licensing activities. Concord Music Group, Inc. was formerly known as Concord Records, Inc. and changed its name to Concord Music Group, Inc. in December 2004. The company was founded in 1969 and is based in Los Angeles, California. It has additional offices in Beverly Hills, California; Nashville, Tennessee; New York, New York; Cleveland, Ohio; London, United Kingdom; and Berlin, Germany. Concord Music Group, Inc. operates as a subsidiary of Concord Bicycle Music. " Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 Sugar Hill? Say it san't so, Sylvia! Our American heritage is being robbed from us. Again. Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 4, 2021 Report Share Posted June 4, 2021 People say, why you keep them old records, it's all on the internests, and sure, as long as they want it to be. And i do not have 100% confidence that they always will. Quote Link to comment Share on other sites More sharing options...
Bluesnik Posted June 4, 2021 Report Share Posted June 4, 2021 19 minutes ago, JSngry said: And i do not have 100% confidence that they always will. I'm also not so sure. Quote Link to comment Share on other sites More sharing options...
medjuck Posted June 5, 2021 Report Share Posted June 5, 2021 16 hours ago, JSngry said: Ted Gioia seems to think that this is a suckers' game over the long haul. https://tedgioia.substack.com/p/why-are-investment-funds-obsessed But the days of long game...good luck on that! Good article but I'm not sure that the analogy to songs from 1941 works. Nobody was listening to them even 40 years later but we still hear a lot of music from nearly 60 years ago. This article doesn't take into consideration the chasm caused by rock n'roll (and be-bop). Of course there could be another such chasm around the corner...... Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 5, 2021 Report Share Posted June 5, 2021 https://www.media.mit.edu/articles/how-we-ll-forget-john-lennon/ Quote Link to comment Share on other sites More sharing options...
Rooster_Ties Posted June 5, 2021 Report Share Posted June 5, 2021 3 hours ago, JSngry said: https://www.media.mit.edu/articles/how-we-ll-forget-john-lennon/ Who? Quote Link to comment Share on other sites More sharing options...
JSngry Posted June 5, 2021 Report Share Posted June 5, 2021 15 minutes ago, Rooster_Ties said: Who? Like Jesus, only bigger. Quote Link to comment Share on other sites More sharing options...
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