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Blackstone considering bid for Hipgnosis Songs Fund

Hipgnosis Songs Fund (LSE: SONG) has disclosed its openness to a cash bid from Blackstone Inc., should one be proposed. The announcement comes hot on the heels of a $1.40 billion bid by Alchemy Copyrights, …

Hipgnosis Songs Fund (LSE: SONG) has disclosed its openness to a cash bid from Blackstone Inc., should one be proposed. The announcement comes hot on the heels of a $1.40 billion bid by Alchemy Copyrights, trading as Concord Chorus Ltd, which Hipgnosis had already accepted.

Blackstone’s bid values each share of Hipgnosis Songs Fund at $1.24, amounting to a total valuation of $1.50 billion for the company. Hipgnosis, after careful consideration with its financial advisor Singer Capital Markets, has expressed its inclination to recommend Blackstone’s offer to its shareholders, should Blackstone make a firm intention to bid.

However, Hipgnosis has also made clear that there’s no certainty regarding Blackstone’s bid, nor the terms it might entail. Consequently, shareholders are advised to refrain from taking any immediate action regarding Blackstone’s approach.

Despite Blackstone’s interest, Hipgnosis remains committed to the $1.40 billion bid from Concord, wherein shareholders would receive $1.16 in cash per share. Notably, Concord’s offer also includes provisions for additional payouts, potentially reaching up to $25 million in total, contingent on the termination of the investment adviser deal with Hipgnosis Song Management Ltd.

This offer from Concord comes amid an ongoing dispute between Hipgnosis Songs Fund and its investment adviser, Hipgnosis Song Management, led by founder Merck Mercuriadis. Allegations of misconduct against the latter have fueled tensions, particularly stemming from a rejected proposal to sell a portion of the fund’s portfolio to a joint venture involving Blackstone and Hipgnosis Song Management. This disagreement led to significant board changes within the fund.

Hipgnosis Songs Fund shares were little move on Friday, closing 0.5% lower.


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