Harmony to amass Stem in $50m+ deal, say MBW sources
MBW hears that Harmony could be very shut to creating one other vital acquisition.
Our sources inform us that the corporate is within the last phases of buying Stem, a Los Angeles-headquartered music distribution and funds platform, in a excessive eight-figure deal, above $50 million.
The deal isn’t fairly finished but, in response to our sources. We additionally hear that The Raine Group is in the midst of it.
This information arrives round 4 months after Harmony efficiently closed an Asset-Backed Securities (ABS) transaction, which noticed the corporate increase $850 million in debt financing by a personal securitization backed by its catalog of music rights.
The corporate mentioned in October that the transaction would “gas strategic progress and acquisition[s]” and that it underscored its “ongoing effort to strategically develop and monetize its music belongings and place the corporate as a consequential drive within the music business”.
Information of the ABS deal arrived shortly after Harmony spent USD $217.3 million on the catalog of Latin Music artist and songwriter Daddy Yankee.
Harmony acquired elements of the music publishing and recorded music catalog of the reggaetón star, together with rights to his personal hits together with Rompe, Gasolina, and Con Calma, plus his featured artist position on Despacito.
Most not too long ago, in January, Harmony acquired a portion of songwriter, musician, and producer Johnny McDaid’s music catalog. McDaid is a key collaborator of Ed Sheeran’s – co-writing lots of the British artist’s largest hits – and can be a member of the band Snow Patrol.
Harmony manages a couple of million compositions, grasp recordings, and associated belongings throughout writers/artists together with stars similar to R.E.M, Creed, Genesis, Phil Collins, Mike + The Mechanics, and Carrie Underwood.
In 2023, Harmony bulked up its frontline recorded music credentials with the announcement of a JV label, PULSE Information, with the broadly revered Pulse Music Group crew.
Harmony grew to become a majority proprietor in Pulse Music Publishing by way of a $100m+ deal in 2020. PULSE has seen success within the US and globally this yr with the Tommy Richman hit Million Greenback Child (PULSE Information/ ISO Supremacy).
Harmony, which continues to be majority-owned by its long-term backer, State of Michigan Retirement Programs, entered right into a strategy of exploring a sale itself (partaking Goldman Sachs as its wing-person) a few years in the past.
That course of led to a ~$5 billion takeover supply from an unnamed suitor, however this price-tag wasn’t deemed massive sufficient for the corporate, which was in search of “extraordinary” affords solely.
Based in 2015, Los Angeles-based Stem operates in music distribution, funds, and royalty providers. In 2023, the corporate launched a monetary providers platform beneath the ‘Tone’ model.
Whereas Stem affords curated distribution providers for impartial artists and labels, Tone was launched to supply a collection of monetary instruments tailor-made to the music business.
The launch arrived two months after securing a $250 million credit score facility from Chicago-headquartered Victory Park Capital. In 2022, Stem raised $20 million in a funding spherical led by QED Buyers, a enterprise capitalist agency within the fintech area.Music Enterprise Worldwide
