The bidding warfare between Blackstone and Harmony over the acquisition of Hipgnosis Songs Fund could also be over, however Blackstone faces a brand new impediment in its quest to amass the UK-listed music rights firm: Hipgnosis’s hedge fund shareholders desire a increased worth.
In keeping with evaluation Monetary Occasionsthese hedge funds had sufficient Hipgnosis to dam a vote to approve the Blackstone acquisition, which might have required approval 75% Passage of voting shares.
Earlier this month, Blackstone raised its bid for Hipgnosis, growing its earlier supply $1.30 per share $1.31 use money. This brings its bid for Hipgnosis to $1.584 billionbased on Blackstone’s calculations, from $1.572 billion It made a suggestion in late April, a determine that was sufficient for Harmony to desert its acquisition of Hipgnosis.
Blackstone additionally restructured its takeover bid right into a “plan of association.” Below UK regulation, materials adjustments to an organization’s construction will be effected by such a scheme of association below a courtroom order, however have to be accepted by at the very least one consultant shareholder 75% inventory.
For Blackstone, the advantage of this association is to make sure that current shareholders won’t proceed to carry a minority stake after the acquisition, Monetary Occasions the report mentioned.
In a regulatory submitting this week, Blackstone made clear it didn’t intend to offer in to the hedge funds’ calls for for the next bid.
Blackstone mentioned the supply on the desk was “remaining and won’t enhance.”
Nevertheless, it does exclude one exception: Lyra BikoThe official entity making the supply on behalf of Blackstone “reserves the best to extend the supply worth… if the plans lapse and if there may be an announcement… that a suggestion for Hipgnosis is being made or {that a} third get together offeror or potential offeror could also be provided.”
In different phrases, until Harmony (or another person) comes again in with the next supply, hedge funds will not get any extra from Blackstone than personal fairness corporations are providing.
based on Monetary Occasionshedge funds holding shares of Hipgnosis embrace argon arc weldingGrew to become the most important shareholder of Hipgnosis 14% guess; Glazer Capitalwith environment 8%; Krieger Capitaland 6.6%; and Sandgrove Capital Administrationwith environment 6%.
Battle for management of Hipgnosis Music Fund and its doubtlessly helpful music rights $2.2 billion Began by unbiased music firm Harmony produced $1.4 billion April tender supply for the belongings of Hipgnosis Songs Funds.
Quickly after, Blackstone was fashioned, a conglomerate with greater than $1 trillion Among the many belongings below administration, added US$1.5 billion personal quote.
Harmony got here again with a counteroffer of its personal, bidding US$1.5115 billion For Higpnosis, barely lower than 1% increased than Blackstone’s bid.
Blackstone strikes again $1.572 billion ($1.30 The bid per share) was accepted by Higpnosis’s board of administrators in late April.
That was sufficient to persuade Harmony to withdraw from the bidding warfare.
Nonetheless, in early June, Blackstone barely elevated its supply, bringing it to its present worth $1.584 billionapparently to make sure it has full management of Hipgnosis shares
So will the “remaining” supply introduced by Blackstone trigger hedge funds to make concessions? Might a hedge fund’s seek for increased dividends result in a failed deal?
The drama over the way forward for the Hipgnosis Music Fund is not over but.international music enterprise
