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Round Hill Music proceeds with pipeline purchase

Round Hill Music Royalty RHM

Round Hill Music proceeds with pipeline purchase – in Round Hill Music Royalty Fund’s  prospectus, it identified a portfolio of catalogues – the Pipeline Investments. These comprise the existing assets of Round Hill Fund One, a private fund whose investments are managed by Round Hill. The Pipeline Investments were independently valued with an aggregate valuation of US$363m, and achieved a net publisher’s share (“NPS”) multiple of 16.2x, on US$22.4m of NPS for the trailing twelve months ending 30 June 2020.

The board plans to buy the Pipeline Investments by way of a two-step process.

First Investment

The first step comprises the acquisition of the assets of Round Hill Fund One excluding its shareholding in RH Carlin Holdings LLC. This deal completed on 1 February 2021. Round Hill Music spent $281,860,320 (86% of the gross proceeds from its IPO and subsequent placing). The price is based on an independent valuation of the assets acquired as at 30 June 2020.

Under the terms of the deal, the company is entitled to receive all income generated by the assets with effect from 1 January 2021, regardless of when the income was earned. This package of rights includes copyrights from artists such as the Beatles, Marvin Gaye, Celine Dion, Rod Stewart, Phil Collins, James Brown, The Offspring, Kiss, Back Street Boys, Lady A and many more. They say that this portfolio is extremely well diversified by genre and income type with a significant proportion of the copyrights from the period between the 1960s and the 1990s.

Second Investment

The second step will involve the purchase of a 29.14% share in the Carlin copyrights owned by Round Hill Fund One. Carlin’s underlying portfolio comprises over 100,000 copyrights across multiple genres from jazz, country, pop, rock and dance, including classics made famous by artists such as Elvis Presley, Meatloaf, James Brown and Billie Holiday, including songs such as “What A Wonderful World”, “Total Eclipse of The Heart”, “Happy Together”, “Under the Boardwalk”, “Are You Lonesome Tonight” and many more.

Round Hill Music is undertaking due diligence into Carlin and its assets, and negotiating the terms of the acquisition documentation. Despite difficulties relating to COVID-19, including the closure of the Copyright Office of the Library of Congress in Washington D.C, and personnel within the legal firms advising the company contracting the virus, it is currently anticipated that the acquisition of the second investment will complete no later than 31 March 2021. The price will reflect the underlying valuation of the copyrights owned by Carlin as of 30 June 2020.

Borrowing facility and fundraise

The board says that detailed heads of terms have been agreed with Truist Securities, Inc. for it to act as lead arranger to provide, arrange or place a revolving facility (RCF) with a syndicate of banks and other institutional lenders.  It is anticipated that the RCF will be used to part finance the second investment as well as to acquire future pipeline opportunities.

Following the completion of the second investment, the company will have fully invested the capital raised in the IPO and subsequent placing [you can guess what happens next].  There is a further near term pipeline worth about $500m. The board is exploring various options to finance their acquisition, including a potential equity raise.

Dividend

Following the completion of the second investment, the company anticipates paying a first interim dividend (expected to be declared in March 2021 and paid in June 2021) as part of a planned 4.5% dividend on the IPO price for he year ended 31 December 2021.

This is what Round Hill is buying:

Catalogue

Songs in Catalogue

Primary Decade

Comment

Adage V

315 + 5,200 cues and themes

1960s and 1970s

Contains classic songs from R&B and jazz songs from the 1960s and 1970s such as “Land of A Thousand Dances”, “Mercy, Mercy, Mercy”, “Birdland” and “I Can’t Stand The Rain”. Also, contains thousands of themes and cues from iconic children’s TV programmes such as Pokemon, Yugioh and Sonic X, which earn steady performance income worldwide

Gerald Marks

333

1940s

Features jazz standard “All of Me,” recorded by artists including Frank Sinatra, Ella Fitzgerald, Billie Holiday and Michael Bublé

Charlie Midnight

608

1980s

Contains hits by artists such as James Brown, Joni Mitchell, The Doobie Brothers, Britney Spears, Seal, Billy Joel, Christina Aguilera, Hilary Duff, Big Time Rush, Whiskey Falls, Paul Stanley and Dan Hartman. Key song “Livin’ In America”

GIL/GPS

446

1960s

Artists such as The Rolling Stones, Otis Redding, Patti Page, The Del Vikings, John Lee Hooker, Gene McDaniels, Groove Armada, Pat Boone, Ricky Nelson and six famous Beatles songs: “She Loves You”, “I Saw Her Standing There”, “From Me To You”, “Misery”, “I Wanna Be Your Man” and “There’s a Place”

Arthouse

176

2010s

Cultural anthems of this decade from artists including Bruno Mars, CeeLo Green, Carrie Underwood, Katy Perry and more

Calvin Lewis

3

1960s

Features rights to the hit song “When a Man Loves a Woman,” recorded by artists including Percy Sledge, Michael Bolton, Marvin Gaye and Art Garfunkel, amongst others. The song was named the 54th most popular song of all time by Rolling Stone Magazine

Kid Rock Writers

28

1990s

Consists mainly of songs from Kid Rock’s album Devil Without a Cause, which has sold over 11 million albums worldwide

Marti Frederiksen

330

2000s

Features compositions by iconic rock artists, including: Daughtry, Aerosmith, Def Leppard, Fuel, Mötley Crüe, Ozzy Osbourne, Gavin Rossdale, Foreigner, Buckcherry and more

Spacehog

45

1990s

Contains the entire repertoire of songs from the band Spacehog including publishing and master rights to “In The Meantime”

Vinnie Vincent

25

1980s

Represents hit songs from the worldwide legendary rock band Kiss including “Lick It Up”

Stephan Chamberlain

23

1980’s

Represents hit songs from the iconic hard rock band Warrant

Big Tractor

3700

2000s

Represents classic country hits such as “I Saw God Today” by George Strait and “Amazed” by Lonestar and also represents newly released singles from country superstars Blake Shelton and Hunter Hayes

Bush Masters

57

1990s

Consists of master assets of hard rock music that includes post Nirvana ’90s grunge hits such as “Glycerine”, “Everything Zen”, and “Machinehead”

Monty Criswell

192

2000s

Includes approximately 192 demoed songs, 28 of which have been cut. Many of the uncut but demoed compositions are street ready for continued exploitation in the marketplace

Andreas Carlsson

402

2000s

Includes hits by various artists including: N Sync, Backstreet Boys, Britney Spears, Celine Dion, Katy Perry, Carrie Underwood and Bon Jovi

Tesla

70

1990s

Contains all of Tesla’s biggest hits over the last 30 years such as “Love Song,” “Modern Day Cowboy,” “Gettin’ Better” and “Comin’ Atcha Live”

Bosshouse

695 musical works; 827 masters; 132 compilations

2000s

The iconic shows and films that the songs are for include: Dexter, True Blood, CSI, Shameless, Pretty Little Liars, Smallville, Frasier, Buffy The Vampire Slayer, ER, Lost, Diary of A Wimpy Kid, and American Idol

Howie Day

100

2000s

Includes the royalty income stream from publishing and master recordings of Howie Day’s work, including the hit song “Collide”

Root 49

635

2000s

Contains song catalogues of talented songwriters such as Bridgette Tatum, Danny Myrick, and Odie Blackmon and includes major hit by Jason Aldean “She’s Country”

Big Loud Shirt

7000

2010s

Over 30 #1 hit Country singles including Grammy Awards for Country Song of The Year for “Blown Away”, “Before He Cheats”, and “Live Like You Were Dying”

Wade Kirby

80

2010s

Includes cuts and singles by George Strait, Blake Shelton, Jason Aldean, Faith Hill, Darius Rucker, Craig Morgan, Tate Stevens, Joe Nichols, Billy Currington, Gretchen Wilson and many others

Eddie Schwartz

1

1980s

One song catalogue. “Hit Me With Your Best Shot” by Pat Benatar has sold well over a million copies in the U.S., achieving a gold certification by the Recording Industry Association of America

Josh Kear

148

2000s

In 2007, he had his breakthrough number one song with Carrie Underwood’s massive hit “Before He Cheats” which spent five weeks at the top of the charts. Also “Need You Now” by Lady A which was also a massive hit and covered by Adele. In November 2014, Josh celebrated his 10th number one song “Neon Light” by country superstar Blake Shelton

Eddie Holland

300

1960s

Catalogue contains 25 #1 hit singles, including: “(Love Is Like A) Heat Wave” by Martha & the Vandellas, “How Sweet It Is (To Be Loved By You)” and “Baby Love” by Marvin Gaye, and “Stop! In the Name of Love”, “You Can’t Hurry Love”, and “You Keep Me Hangin’ On” by The Supremes. In addition to the original Motown artists, artists such as Rod Stewart, James Taylor, and Phil Collins have recorded their versions of these songs

Florida Georgia Line

53

2010s

FGL’s #1 hits include: “Cruise”, “Get Your Shine On”, “Round Here”, “Stay”, and “This Is How We Roll” and are some of the biggest all time Country hits

The Offspring

135

1990s

The Offspring is a band formed in Huntington Beach, CA in 1984.  They have sold over 40 million albums worldwide and are considered one of the best-selling punk rock bands of all time

Jimmy Robbins

145

2010s

Jimmy has written songs for Luke Bryan, Kelly Clarkson, Lady A, Keith Urban and many others. His song “Gonna Want You Tonight” was the 10th most played song on Country radio in 2015

Toby Keith

126

2000s

Included in the catalogue is the song “I Love This Bar” which reached #1 on the Country charts in the autumn of 2003 and stayed in that position for 5 weeks

Suzy McNeil

21

2010s

Suzy is a Canadian pop rock singer and songwriter who first garnered attention as a contestant on Rock Star: INXS in 2005

Bob DiPiero

230

2010s

Bob DiPiero has written 15 U.S. #1 hits and countless top 20 hits for the likes of Tim McGraw, The Oak Ridge Boys, Reba McEntire, Vince Gill, Faith Hill, Shenandoah, Neal McCoy, Highway 101, Restless Heart, Ricochet, John Anderson and George Strait, among others

Al Anderson

1

2010s

“Loving You Easy” is a song recorded by American Country music group Zac Brown in 2015. The song achieved #1 on Billboard’s U.S. Country Airplay in August 2015

Chris Tompkins

156

2000s

Chris Tompkins has consistently been a top Country music writer and he started working with Big Loud Shirt in 2006. Hits include “Blown Away” by Carrie Underwood

Triumph

170

1980s

Masters of classic rock band from Canada who had commercial success in the 1980’s with “Lay It On The Line” and others. Triumph is one of Canada’s most important musical icons

Eric Carmen

152

1970s

Eric Carmen wrote 100% of “All By Myself” which was a major hit for himself as well as Celine Dion. Catalogue also includes hits such as “Hungry Eyes” from the Dirty Dancing soundtrack and “Make Me Lose Control”

Jani Lane

53

1980s

Jani Lane was the principal songwriter for the 1980s’ rock band Warrant. Songs include “Cherry Pie”, “Heaven” and “Down Boys”

Ted Nugent

154

1970s

Hits include “Stranglehold”, “Cat Scratch Fever” and songs by Damn Yankees such as “High Enough”

Louis Yoelin

4500

2010s

TV cues and background music

Pressman Film

142

2010s

Soundtrack to the movie “The Man Who Knew Infinity”

Co-Pub

 

5587

2010s

Main co-publishing songs are “Best Day of My Life” by American Authors

Admin

3409

1970s

Includes administration rights to Neil Sedaka and others

RHM : Round Hill Music proceeds with pipeline purchase

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