After receiving first-time corporate credit ratings of B1 and B+ from Moody’s and S&P last month, Concord closed on a $600 million term loan B debt offering which, in addition to the company’s existing $450 million revolving credit facility, provides Concord with access to more than $1 billion of total debt financing.
The term loan B offering, which was placed with 90 investment firms by J.P. Morgan, was upsized from an initially proposed $400 million issuance due to more than six times oversubscription after a two-week marketing process. Proceeds from the new debt will be used to partially pay down the company’s revolving credit facility, allowing for additional capital availability for future acquisitions and working capital.
“This highly successful debt offering is further validation that institutional investors believe in Concord’s long-term strategy of building one of the preeminent independent music companies in the world,” Bob Valentine, CFO of Concord, said. “It also shows that those investors are hungry to invest in timeless music content with global appeal that can be legitimately accessed and enjoyed by consumers everywhere, in more diverse and readily available ways than at any time in history. We are especially appreciative of our financing partner of over 20 years, J.P. Morgan, for their continued support in the evolution of our company, and are thrilled to share yet another milestone with them.”
“For more than two decades J.P. Morgan has had the pleasure of working with Concord and watching them evolve to become the preeminent independent music company they are today,” David Shaheen, head of entertainment industries and the west region for J.P. Morgan’s corporate client banking and specialized industries business. “Concord’s success is a testament to the quality of their management and strength of sponsorship. We look forward to helping them build on their numerous accomplishments.”
“We couldn’t be happier with the results that the J.P. Morgan team achieved for us in this transaction. Their execution was flawless, and it is very satisfying to see Concord’s hard work and strategic growth of the past few years be so well-received by such a large group of sophisticated financial institutions,” Scott Pascucci, CEO of Concord, said.
Concord has increased its revenue nearly four fold over the last five years due to organic growth and strategic acquisitions to which it has committed more than $1 billion since 2017. In January, Concord acquired a substantial equity position in music publisher PULSE Music Group. PULSE’s roster is responsible for four Hot 100 No. 1 hits this year and includes Kehlani, Starrah, Ty Dolla $ign, BloodPop, Flo Milli and Trevor Daniel, whose new single “Falling” hit No. 1 at Top 40 Radio and has been certified two times platinum by the RIAA. Last month, Concord signed Hillary Lindsey to an exclusive worldwide co-publishing agreement with regard to her future works while also acquiring an interest in her back catalog and forming a new joint venture to develop upcoming country songwriters. Lindsey’s catalog includes 11 No. 1 singles with Carrie Underwood as well as Luke Bryan, Lady A, Taylor Swift and Keith Urban. Concord also recently purchased the publishing catalog of Imagine Dragons, including four singles that each hit 1 billion streams on Spotifysuch as the RIAA Diamond single “Radioactive.” These 2020 transactions follow Concord’s recent acquisitions of recorded music and publishing companies such as Musart, Fania, Independiente, Varese Sarabande, Victory Records and Sikorski Music Publishing.
Over the past three years, Concord also created a theatricals licensing company, Concord Theatricals, by combining The Rodgers and Hammerstein Organization, which it acquired as part of its acquisition of Imagem in 2017, with the works of Andrew Lloyd Webber, and the Tams-Witmark and Samuel French licensing houses.
DLA Piper represented Concord in this transaction.
“We were thrilled to once again partner with Concord on this complex, cross-border financing, which highlights the abilities and experience of our U.S. and UK media, entertainment and leveraged finance practices, as well as our deep understanding of the music and related media industries and our ability to successfully coordinate complex cross-border transactions,” Robert J. Sherman, co-chair of DLA Piper’s entertainment finance practice, who led the firm’s deal team, said.
“I’ve worked with Rob for over 15 years and am always appreciative of the legal and strategic insights he and his team at DLA Piper bring to bear on our most important transactions,” Valentine said. “The tireless efforts of DLA Piper’s global media and entertainment finance and transactional practices exceeded our expectations and were critical to our ability to close this complex, cross-border financing in the midst of the most challenging circumstances.”
In addition to Sherman, the DLA Piper team representing Concord included partners Afshin Beyzaee, Claire Hall (both of Los Angeles) and Jamie Knox (New York), and associates Daniel Zar and Payvand Coyle (both of Los Angeles) in the U.S., and partners Mark Dwyer, global co-chair of the financial services sector, and Ben Brown, legal director Jennifer Jin and associates Melissa Lim and Elizabeth Baek in London.
Concord is an independent music and theatrical rights company.
