Bruce Springsteen’s blockbuster catalog sale to Sony Music Group this week also established a new player in rights acquisitions.
Investment firm Eldridge Industries, which partnered with Sony to finance the purchase of Springsteen’s publishing, now holds a stake one of the industry’s most coveted catalogs — around which it can build an attractive portfolio.
Eldridge Industries is a private investment firm with holdings in tech, media, retail, entertainment and other sectors. Co-founded in 2015 by Todd Boehly, a former president at Guggenheim Partners, Eldridge investments include the Los Angeles Dodgers baseball team, sports gambling company DraftKings, private jet provider Flexjet and personal finance app Truebill, among others. Eldridge owns a stake in P-MRC, a joint venture of MRC and Penske Media Corporation that operates Billboard, The Hollywood Reporter, Variety, Rolling Stone and other media brands.
The Springsteen deal marks the company’s second major music deal, following its acquisition of The Killers’ pre-2020 publishing catalog — both publisher’s and writers’ share — that includes mega-hits “Somebody Told Me” and “Mr. Brightside” and covers the group’s first five albums.
With both deals, Eldridge has opted to partner with major publishers to work the catalogs and The Killers’ songs continue to be administered by Universal Music Publishing Group.
For the Springsteen deal, Eldridge teamed with Sony Music Publishing to acquire the artist’s career-spanning songwriting catalog of countless classics such as “Dancing in the Dark” and “Born to Run.” It did not participate in Sony’s acquisition of Springsteen’s recordings. In total, Sony paid upwards of $500 million for the two catalogs. Billboard estimates Springsteen’s publishing catalog alone generates $7.5 million per year and is worth upwards of $225 million at a premium 30-times multiple commanded by elite catalogs.
As music catalog prices continue to soar, the partnership makes sense for both companies. Sony, which spent $1.4 billion on music assets in the first half of 2021 — including Paul Simon’s publishing catalog — can afford more top-shelf catalogs with a partner like Eldridge helping carry the financial burden. Working with Sony, the largest music publisher, gives an outsider such as Eldridge a seat at an exclusive table. Such pairings can be crucial when competitors have combined resources to pursue the most desirable catalogs.
Already in 2021, three major private equity firms have pledged significant funding for fmusic rights: Blackstone and Hipgnosis Songs Management announced a $1 billion partnership in October and KKR is again working with BMG “to invest in transactions of all sizes,” the companies said in March. Also in October, Apollo Global Management committed up to $1 billion to fund HarbourView Equity Partners to buy entertainment assets such as publishing and recording rights. Blackstone, KKR and Apollo have a combined $1.57 trillion under management.
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Tagged: business, catalog sales, Eldridge Industries, entertainment blog, Finance, music blog, Publishing, Sony Music