Universal Music Group-backed investment vehicle Chord Music Partners has raised over USD $2 billion in investible capital to buy music rights.
That’s according to MBW sources close to the company, who say Chord has raised the sum via a funding round due to close in October.
Those same sources expect Chord will secure an additional $1 billion to $2 billion in investible capital before the round closes – taking its total raise to between $3 billion and $4 billion.
The round – which covers the period Chord launched with UMG last year to date – is understood to have been fuelled by equity investments from several family offices and pension funds across Europe and the US.
Universal Music Group has maintained its ~26% share in Chord, contributing an incremental EUR €30 million investment into the vehicle earlier this year, UMG has confirmed. Dundee Partners remains the controlling shareholder in Chord.
Like the investment capital raised by Warner and Bain Capital’s new JV last month, Chord’s $2 billion+ funding is understood to involve a debt component.
One of Chord’s new investors has today (August 14) been confirmed as Searchlight Capital Partners, a global investment firm with offices in New York, London, Miami, and Toronto and more than $18 billion in assets under management. MBW understands that Searchlight has contributed $400 million to Chord in equity investment.
“Searchlight looks forward to contributing to Chord’s next chapter of growth and value creation for both its artists and existing investors.”
Darren Glatt, Searchlight
Commenting on the deal, Darren Glatt, Partner at Searchlight, said: “The Chord team have built an incredibly strong and diversified platform at the forefront of music investment and evolved Chord into the desired home for the works and legacies of the world’s premier artists.
“Searchlight looks forward to contributing to Chord’s next chapter of growth and value creation for both its artists and existing investors.”
“Searchlight’s expertise, network and ability to meaningfully contribute toward expanding Chord’s premier IP portfolio make Searchlight an ideal strategic partner for our Company’s next chapter.”
Sam Hendel, Dundee Partners / Chord
Sam Hendel, Dundee Partners’ Managing Principal and Co-Founder of Chord, added: “Searchlight’s expertise, network and ability to meaningfully contribute toward expanding Chord’s premier IP portfolio make Searchlight an ideal strategic partner for our Company’s next chapter.
“We’re thrilled to welcome them into the fold and look forward to pursuing the increasingly exciting opportunity set within today’s music landscape together.”
Chord has been “deliberately quiet” in terms of announcing deals over the past year, say sources, but some nine-figure agreements have leaked, including a Morgan Wallen acquisition reported in May.
That deal saw Big Loud, the Nashville-based record label home to the country superstar, sell a minority stake in Wallen’s master recording catalog to Chord for north of USD $200 million, according to MBW’s sources, although financial details were not officially disclosed.
Chord Music Partners was founded in 2021 by investment companies KKR and Dundee Partners. In addition to its interest in the Morgan Wallen catalog, it has built a portfolio that includes music from The Weeknd, Lorde, David Guetta, and more.
That deal, which saw Chord valued at USD $1.85 billion, resulted in KKR exiting its position in the company.
Under the strategic partnership between Dundee Partners and Universal Music Group, Chord’s music publishing rights are administered through Universal Music Publishing Group (UMPG) and recorded music through UMG’s Virgin Music Group (VMG).
Today’s news arrives a couple of weeks after Universal Music Group’s Chief Operating Officer Boyd Muir commented on the progress of the Chord investment vehicle during UMG’s Q2 earnings call at the end of July.
“We also continued our long-term strategic investment in the business. We paid EUR €149 million for catalog acquisitions in the period, about half of which are catalogs that will be moved into the Chord vehicle in the coming months,” Muir told investors on the call.
He added: “Chord is successfully raising capital and building a strong deal pipeline. The structure is working exactly as we envisioned – enabling us to move quickly to acquire high-quality catalogs, without significant capital allocation over time.”
Muir also confirmed that “to maintain our share of ownership in the vehicle, we also made a EUR €30 million incremental equity investment into the business in the first half of the year.Music Business Worldwide
