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Episode 41 — PE Views: Why Do Music Deals Sound So Attractive to PE?

June 9, 2022
Music deals have struck a chord for PE investors, though notes of complexity remain.

Music deals, particularly the acquisition of rights to songs and recordings by popular music artists, remain attractive investments for PE. The continued popularity of global streaming services and the music rental economy have helped to reduce the threat of online piracy, made revenues easier to track and predict, and ensured that strong revenues continue to flow to rights holders.

Music rights will likely become even more attractive as revenues are increasingly derived from a growing number of sources, including social media platforms, video games, exercise platforms, video streaming, and virtual reality. Yet PE investors should note the complex tune of music deals, considering the depth and size of catalogues, re-recording risks, and range of sellers involved. Still, as the use of popular music continues to broaden, rights holders will reap the dividends.

In this episode of Connected With Latham, London private equity partner Tom Evans speaks to London entertainment, sports, and media partner Libby Savill about why music deals are expected to stay at the top of the charts for PE teams.

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