MBW hears that Concord is very close to making another significant acquisition.
Our sources tell us that the company is in the final stages of acquiring Stem, a Los Angeles-headquartered music distribution and payments platform, in a high eight-figure deal, above $50 million.
The deal isn’t quite done yet, according to our sources. We also hear that The Raine Group is in the middle of it.
This news arrives around four months after Concord successfully closed an Asset-Backed Securities (ABS) transaction, which saw the company raise $850 million in debt financing through a private securitization backed by its catalog of music rights.
The company said in October that the transaction would “fuel strategic growth and acquisition[s]” and that it underscored its “ongoing effort to strategically grow and monetize its music assets and position the company as a consequential force in the music industry”.
News of the ABS deal arrived shortly after Concord spent USD $217.3 million on the catalog of Latin Music artist and songwriter Daddy Yankee.
Concord acquired parts of the music publishing and recorded music catalog of the reggaetón star, including rights to his own hits including Rompe, Gasolina, and Con Calma, plus his featured artist role on Despacito.
Most recently, in January, Concord acquired a portion of songwriter, musician, and producer Johnny McDaid’s song catalog. McDaid is a key collaborator of Ed Sheeran’s – co-writing many of the British artist’s biggest hits – and is also a member of the band Snow Patrol.
Concord manages more than one million compositions, master recordings, and related assets across writers/artists including stars such as R.E.M, Creed, Genesis, Phil Collins, Mike + The Mechanics, and Carrie Underwood.
In 2023, Concord bulked up its frontline recorded music credentials with the announcement of a JV label, PULSE Records, with the widely respected Pulse Music Group team.
Concord became a majority owner in Pulse Music Publishing via a $100m+ deal in 2020. PULSE has seen success in the US and globally this year with the Tommy Richman hit Million Dollar Baby (PULSE Records/ ISO Supremacy).
Concord, which continues to be majority-owned by its long-term backer, State of Michigan Retirement Systems, entered into a process of exploring a sale itself (engaging Goldman Sachs as its wing-person) a couple of years ago.
That process led to a ~$5 billion takeover offer from an unnamed suitor, but this price-tag wasn’t deemed large enough for the company, which was looking for “extraordinary” offers only.
Founded in 2015, Los Angeles headquartered Stem operates across music distribution, payments, and royalty services. In 2023, the company launched a financial services platform under the ‘Tone’ brand in 2023.
While Stem offers curated distribution services for independent artists and labels, Tone was launched to offer a suite of financial tools tailored to the music industry.
The launch arrived two months after securing a $250 million credit facility from Chicago-headquartered Victory Park Capital. In 2022, Stem raised $20 million in a funding round led by QED Investors, a venture capitalist firm in the fintech space.Music Business Worldwide
