Canada-headquartered independent music company Nettwerk Music Group has a new strategic partner.
The company has announced what it calls “a significant structured investment” as well as a new strategic partnership with private equity investment firm Flexpoint Ford, which has approximately $7.8 billion of regulatory assets under management.
Existing Nettwerk Music Group investors Beedie Capital and Vistara Growth also participated in the latest round and will remain shareholders in the Company and members of the board of directors.
The value of the round was undisclosed.
According to Nettwerk CEO and co-founder Terry McBride, “the capital from Flexpoint will enable Nettwerk to invest in artists and make music catalogue acquisitions”.
The new capital is being provided by Flexpoint’s second fund, Flexpoint Asset Opportunity Fund II, which, according to a media statement “leverages the firm’s institutional knowledge and relationships to complete opportunistic investments across the capital structure”.
Flexpoint, which has offices in Chicago, Illinois, and New York, New York, closed its Flexpoint Asset Opportunity Fund II in September 2021, at $825 million.
Founded in 1984, Nettwerk operates across recordings, publishing and management.
The investment round and partnership with Flexpoint comes two years after the Vancouver-based company announced a recapitalization of its business that included the purchase of a stake in the business held by HBC Investments.
The purchase of the HBC Investments ownership, said Nettwerk at the time, was “part of a broader financing plan that recognizes the success of the company’s strategy over the past seven years”.
In 2013, HBC Investments, Nettwerk’s founders, and investor Beedie Capital invested $10.25 million in the company to make acquisitions and invest in artists.
“We’re excited to partner with Flexpoint as we continue to execute on our vision of connecting artists with their fans globally.”
Terry McBride
Commenting on the new investment from, and partnership with, Flexpoint, Terry McBride, Chief Executive Officer and co-founder of Nettwerk, said: “The capital from Flexpoint will enable Nettwerk to invest in artists and make music catalogue acquisitions that will benefit from the fast-growing independent sector of the music industry.
“We’re excited to partner with Flexpoint as we continue to execute on our vision of connecting artists with their fans globally.”
“We believe Terry and the team are well positioned to prosper in the rapidly evolving music industry and are excited to help the team execute their vision.”
Mike Morris, Flexpoint
Mike Morris, Managing Director of Flexpoint, said: “Nettwerk has been at the forefront of the evolution in the independent music sector building a compelling catalogue of music by offering white-glove services and growth opportunities to independent artists traditionally reserved for superstars.
“We believe Terry and the team are well positioned to prosper in the rapidly evolving music industry and are excited to help the team execute their vision.”
“As a longtime partner of Nettwerk, we are thrilled to participate in its next phase of growth.”
David Bell, Beedie Capital
David Bell, Managing Director of Beedie Capital, said: “As a longtime partner of Nettwerk, we are thrilled to participate in its next phase of growth.
“The team at Nettwerk are differentiated leaders in a complex industry, and we are excited to support them through continued execution of their unique, artist-centric strategy.”
In 2016, more than 18,000 songs developed and acquired by Nettwerk’s publishing division over the prior 30 years were bought by Kobalt Music Copyrights (KMC).
In November 2020 UK-listed Hipgnosis acquired over 33,000 songs / cuts in songs from Kobalt Music Copyrights S.à.r.l, for $322.9 million.
The portfolio included the 18,000 songs from the Nettwerk music publishing catalog, which Kobalt Capital acquired in 2016.Music Business Worldwide
