Hipgnosis Songs Fund Limited has announced that it has signed a Revolving Credit Facility (RCF) of £65 million from JPMorgan Chase Bank (as Lead Arranger). The RCF will be available for three years and the Company may request an increase in the RCF commitment by a further £35 million subject to certain conditions. Hipgnosis says that the RCF will provide it with flexible capital to both fund investments and to provide it with working capital. In accordance with Hipgnosis’s investment policy, any borrowings by the Company will not exceed 20 per cent. of the value of the assets of the Company less its liabilities.
The RCF imposes a loan to value test and a liquidity test and is secured by, inter alia, a charge over the shares in all the subsidiaries of the Company and over all of their assets, a charge over the bank accounts of the Company and a floating charge over all its assets. The Company has also provided a parent company guarantee.
Comments from Merck Mercuriadis, Founder of The Family (Music) Limited and Hipgnosis Songs Fund Limited
Merck says, “We are delighted to join forces with JP Morgan’s Entertainment Group and welcome them as our preferred leverage partner. Their position, knowledge and activity is at an elite level.”
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