The Weeknd is looking to raise roughly USD $1 billion in financing backed by his music catalog.
That’s according to Bloomberg, which reported on Saturday (August 23), citing people familiar with the matter as saying that the Canadian singer would pledge his stake in publishing rights and master recordings.
No agreement has been reached as discussions are still ongoing, the report said.
New York-based Lyric Capital Group is reportedly leading the talks, with The Weeknd (aka Abel Tesfaye) already reaching out to other investors to assemble the financing package of up to $1 billion.
The proposed deal structure with Lyric reportedly includes $500 million in senior debt, $250 million in junior debt, and $250 million in equity.
Chord Music Partners currently owns a 50% stake in The Weeknd‘s music publishing rights. Chord operates under a consortium that includes Universal Music Group and Dundee Partners, the investment vehicle of the Hendel family.
Meanwhile, Lyric Capital owns Spirit Music Group, which controls publishing catalogs from artists including Tim McGraw, Jason Aldean, and Ingrid Michaelson. Lyric completed fundraising for its second music royalty fund with approximately $800 million in commitments in 2023.
If a deal materializes, it would be one of the biggest catalog-backed music rights transactions in recent years. Apollo Global Management and Carlyle Group have already made investments in the space in recent years.
Tesfaye previously explored selling a portion of his music rights approximately two years ago with an initial valuation target around $1.3 billion, Bloomberg said, citing one of its sources. Those talks did not result in a transaction.
In July last year, Apollo confirmed that it led a $700 million investment into Sony Music Group. This “capital solution”, says Apollo, is intended to fund “investments in the music industry”. In 2022, Apollo Global Management led what it claimed to be the “largest-ever” asset-backed securities transaction for Concord, when the latter company priced a $1.8 billion bond offering backed by over 1 million music copyrights.
Earlier this year, Bloomberg reported that Carlyle Group is close to completing a $464 million bond sale backed by music rights.
Artists like John Legend and Justin Bieber have capitalized on their catalogs to secure funding. In 2023, Bieber transferred his music rights to Blackstone-backed Hipgnosis Song Management. Hipgnosis then issued $1.47 billion in bonds backed by royalties from multiple artists including Shakira, Journey, and Red Hot Chili Peppers, last year.
The Weeknd, whose real name is Abel Makkonen Tesfaye, has attracted over 111 million monthly listeners on Spotify. In 2023, his track, Blinding Lights, surpassed Ed Sheeran’s Shape of You to become Spotify’s most-streamed track of all time.
The reported financing deal comes months after The Weeknd said he would retire his stage name while continuing to make music.
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