Universal Music has taken a minority stake in Chord Music Partners, which was founded by investment firms KKR and Dundee Partners in 2021 to buy up music catalogues. The major music company paid $240 million for a 25.8% interest, giving Chord a valuation of $1.85 billion.
Universal Music boss Lucian Grainge says that “finding partners who share our passion for identifying iconic songs and recordings that will stand the test of time and deliver long-term growth is essential”. Having found such a partner, he and his team now “look forward to creating maximum commercial and creative value for the songwriters and artists in Chord and building for the future”.
Among the artists and songwriters whose work is included in the Chord catalogue are The Weeknd, Ryan Tedder, David Guetta, Lorde, Kid Cudi, Diplo, Ellie Goulding, and John Legend.
As equity funds have become increasingly interested in buying up music rights, they have often been seen as competitors of traditional record labels and music publishers. Although they have also become clients - with traditional music companies often being hired to manage the acquired rights - and partners who can collaborate on big money acquisitions.
Or, in this case, both. As part of this deal, Chord’s song rights will be administered through Universal Music Publishing Group and recorded music through the major’s Virgin Music Group. And UMG and Chord will work together on future acquisitions.
“We’re THRILLED to be partnering with Universal Music Group and embarking on this next exciting chapter for Chord”, says Dundee Partners Sam Hendel. “By combining a best-in-class financial acquisition vehicle with the world’s leading music company, we are creating both a premiere platform for music investment as well as a permanent home for premieree artist’s legacies and their iconic cultural works”.
Once the Universal deal is completed, KKR will exit the business, with Dundee becoming sole owner of the remaining 74.2% stake in the business.
KKR’s Jenny Box comments: “We are grateful to have had the opportunity to collaborate with many leading artists and to create significant value for our investors by building Chord into a differentiated and scaled portfolio. We believe that Dundee and UMG will drive further value creation for artists and that they share our commitment to being respectful stewards of artists’ music”.