Concord Closes $850 Million ABS to Fuel Strategic Growth and Acquisition

Business Wire 28-Oct-2024 11:13 AM

This Marks the Company's Third Securitization Offering, Strengthening its Position in the Music Industry

Concord, the world's leading independent music company, has successfully closed a new series of $850 million in senior notes backed by a diverse catalog of music assets. This marks Concord's third securitization offering and is cross-collateralized with the notes offered in 2022, which, taken together, now make up the largest music-backed asset-backed securitization to date. These issuances underscore Concord's ongoing effort to strategically grow and monetize its music assets and position the company as a consequential force in the music industry. The notes will be secured by music royalties from a pool of catalogs containing over one million songs, including iconic works recorded by The Beatles, Carrie Underwood, Cheap Trick, Creed, Genesis, Kiss, Mike + The Mechanics, Otis Redding, Phil Collins, Plain White T's, R.E.M., R.E.O. Speedwagon, and The Rolling Stones.

Apollo (NYSE:APO), through its Capital Solutions business, Apollo Global Securities, LLC, and together with its affiliate Redding Ridge Asset Management, structured the asset-backed securitization (ABS) and led an investor syndicate for the transaction. ATLAS SP Securities, a division of Apollo Global Securities, LLC, acted as a joint bookrunner for the transaction. Proceeds from the issuance will be used to retire the private 2023-1 note issuance, fund additional acquisitions, and support Concord's continued growth.

"This transaction represents another significant milestone for Concord and the global music industry as we close our third music ABS offering, continuing our strategic efforts to elevate and support the artists and writers in our catalog," said Bob Valentine, CEO of Concord. "We are proud to manage a catalog with such a remarkable depth of artistic talent and cultural importance. We are grateful to our financing partners, Apollo and ATLAS SP, for helping us create a long-term capital structure that supports our growth and strengthens the financial foundation that allows us to keep investing in the music industry. As we grow to new heights, our focus continues to be squarely on our artists and the incredible art they create."

The catalog is valued at more than $5 billion, resulting in an approximate 52% loan-to-value ratio for the offering, and the notes are rated A+ by KBRA and A2 by Moody's. Concord's new 5-year notes issuance is backed by an actively managed catalog of more than 1 million unique music assets spanning a wide range of genres, including over 300 GRAMMY Award winners and more than 400 recordings with Gold, Platinum, Multi-Platinum, and Diamond Recording Industry Association of America (RIAA) certifications.

"Concord's management has demonstrated exceptional vision in building a catalog that reflects the breadth and evolution of modern music, and we are pleased to work with Concord once again on this significant transaction," said Bret Leas, Apollo Partner and Co-Head of Asset-Backed Finance. "By anchoring and structuring this ABS, we have continued to help Concord unlock the value of their extraordinary music catalog. We are proud to provide a tailored solution to support their success," added Apollo's Paul Sipio.

FTI Consulting served as the backup manager for the transaction, with the Bank of New York Mellon acting as trustee. Virtu Global Advisors, LLC provided valuation services, while DLA Piper provided legal counsel for Concord and Milbank LLP for Apollo affiliates.

CONCORD is the world's leading independent music company. The Company supports more than 125,000 artists and songwriters whose works are licensed, marketed, and performed globally. Concord's growing catalog of 1.3 million songs, compositions, sound recordings, films, plays, and musicals is one of the most impactful and culturally relevant collections of creative rights in history.

Concord is headquartered in Nashville with additional offices in Los Angeles, New York, London, Berlin, Melbourne, and Miami.

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