Last July, Round Hill’s publicly-traded UK fund raised USD $86.5 million in C share placing, exceeding its minimum target of a $50 million raise.
Round Hill’s share issue saw it place 86.5 million C shares in Round Hill Music Royalty Fund Limited (RHM) at $1.00 per share.
On Friday, the firm revealed that the net proceeds of that C Share issue have now been fully invested and will be converted into Ordinary Shares.
The firm also gave more details about what it spent that money on.
Since July, according to an announcement published by the firm on Friday, Round Hill says that it has acquired over 5,600 musical compositions using the proceeds of the C Share Issue and “debt drawn from its existing revolving credit facilities (RCF)”.
The copyrights comprised in the acquisitions were acquired at an average historic three-year net publisher’s share multiple of 17.9x.
Round Hill also reveals that rock comprises approximately 90% of the copyrights acquired with the C Share Issue proceeds and debt drawn from its RCF.
Following these acquisitions, Rock now accounts for approximately 54% of the company’s portfolio.
Meanwhile, country accounts for approximately 10 %, and and Pop makes up 18%. Classic R&B and and Other make up approximately 6% and 12 %, respectively.
Round Hill also revealed that its recent acquisitions are “diversified in terms of income type” with performance income accounting for approximately 25%, and master recordings accounting for approx. 50%.
Synchronisation, mechanical and “other” account for approximately 5%, 8% and 12%, respectively.
Elsewhere within the company’s announcement, Round Hill says that its investment manager, Round Hill Music LP, has identified what it says is “a near term pipeline in excess of US $ 120 million of investment opportunities”.
This pipeline includes music publishing, master recordings and neighbouring rights from what Round Hill calls, “various iconic artists, songwriters and producers.
“The Board is considering its options to take advantage of these strong opportunities, for the future benefit of Shareholders,” adds the release from Round Hill.
RHM’s acquisitions since July include:
- The publishing catalog of film score composer and Yes guitarist Trevor Rabin (on August 11, 2021). The acquisition included 3,528 film cues and songs by Rabin.
- The acquisition of 100% of the master royalty income rights to the first seven albums by Foreigner from Dennis Elliott, the original drummer of the rock group (September 9, 2021).
- The recorded music income and publishing rights to a 30-song catalog from Tim Palmer, providing exposure to Pearl Jam and Ozzy Osbourne (September 2021, 15).
- Master royalty income of 532 original recordings from The O’Jays (September 28, 2021).
- Long-term agreement to administer 100% of the neighbouring rights income, generated from the master recordings, of three long-standing members of the British rock group, Supertramp (November 2, 2021).
- On December 2021, the company acquired a significant share of the publishing rights of Niko Moon, the American country singer/songwriter.
- Acquired the master recordings and music publishing assets from American reggae band Rebelution, on December 31, 2021.
- Also on December 31, 2021, the company acquired 100% of a catalog of 308 tracks from the Richardsons, Jack and his son Garth, made up of producer royalties and neighbouring rights income.
- On January 5, 2022, the company announced the acquisition of a significant share of the master artist royalties and entered into a long-term agreement to administer the neighbouring rights income of the catalog of Nancy Wilson, singer, songwriter and guitarist of Rock ‘n’ Roll Hall of Fame-inducted band Heart.
- On January 14, 2022, the company bought the music publishing, master rights and master rights royalties for, and entered into a long-term administration agreement for the neighbouring rights income from, the catalog of Whitesnake frontman and Deep Purple lead singer from 1973 to 1976, David Coverdale.
- On February 8, 2022, the Company acquired a “significant majority” of the rights to a influential American rock band Alice In Chains. The acquisition covers the publishing, masters and neighbouring rights of the band.
This news follows the publication of Round Hill’s publicly-traded UK fund’s first set of interim financial results in September 2021, for the period ended June 30, 2021.
As of that date, Round Hill Music Royalty Fund Limited (RHM) had invested approximately USD $342 million.
That money went on the acquisition of 38 catalogs, plus the purchase of a 29.1% stake in RH Carlin Holdings LLC.
“Rock is a genre which we believe has among the most compelling fundamentals for successful long-term music royalty investing with a consistently more loyal fanbase, and music which is often more enduring than other genres.”
Josh Gruss, Round Hill
Josh Gruss, Chairman and CEO of Round Hill, the Company’ s investment manager, said: “It is fantastic to have had the opportunity to acquire so many high-quality catalogs for the Company with the proceeds from the C Share Issue, providing our investors with access to many leading 20th and 21st century artists including Pearl Jam, Ozzy Osbourne, The O’Jays, Supertramp, Zac Brown Band, Nickelback, Avicii, Rebelution, Alice Cooper, Deep Purple, Yes, Foreigner, Bob Seger, Rage Against the Machine, Chevelle, Rise Against, Trapt, Mudvayne, Heart, and Whitesnake. As planned, the recent acquisitions significantly increase the weighting of the Company’s diverse portfolio in rock music.
“Rock is a genre which we believe has among the most compelling fundamentals for successful long-term music royalty investing with a consistently more loyal fanbase, and music which is often more enduring than other genres.”
“Looking ahead, the investment manager’s pipeline is significant and we look forward to updating Shareholders further in due course.”
Trevor Bowen, Round Hill Music Royalty Fund
Trevor Bowen, Chair of Round Hill Music Royalty Fund, said: “We are delighted to announce the successful completion of the Company’s deployment from the recent C Share Issue into eleven high quality catalogs with many well-known songs, and to provide further disclosure on the quality of those acquisitions.
“Reflecting the Company’s broader portfolio and investment philosophy of preferring catalogs with proven longterm revenue streams, over 77% of the income generated is in respect of compositions written between 1950 and 2010.
“Looking ahead, the investment manager’s pipeline is significant and we look forward to updating Shareholders further in due course.”Music Business Worldwide