In the last few years, some of the world’s biggest music artists have scored huge cash windfalls through the sale of various forms of their catalog and publishing-related intellectual property rights. Stevie Nicks sold 80% of her catalog for $80 million. Neil Young got $150 million for a 50% stake in his publishing rights. Ryan Tedder got $200 million. Bob Dylan scored two deals. In December 2020 he sold 100% of his song catalog to Universal Music for $400 million and about a year later he sold his master recordings to Sony for $200 million. Last December Bruce Springsteen sold his catalog to Sony for $500-600 million. And, if the rumors are true, Justin Bieber is about to join the club of major musicians scoring major catalog sale paydays…
If the reports are true, Justin Bieber is about to sign a deal that will transfer ownership of the musician’s publishing and recorded music catalogs to Hipgnosis Songs Capital. The sale price?
The sale would mean, going forward, Hipgnosis would earn all of the money generated by Justin’s songwriting credits and music royalty generation.
If completed, it would be the largest offered by Hipgnosis and it comes at a time when the hype around music catalog sales have faded considerably. Hipgnosis’ stock price is down more than 30% year-to-date as investors worry that the perceived value of song catalogs may have been inflated by a low-interest rate environment, like many other newer investments like SPACs, crypto and NFTs.
On the other hand, despite his relatively young age (he’s 28) many of Bieber’s songs have already achieved “classic” status, and should produce healthy royalty streams for decades to come. They are not fads that people won’t be streaming in a few years.
The deal would not include Bieber’s master recordings and various other copyrights which are owned by his record company, Universal Music Group.
Prior to the rumored deal, we estimated Justin Bieber’s net worth at $340 million with the assumption that his combined intellectual property rights were worth a total of $200 million.