Hipgnosis eyeing fresh funding for song purchases

Hipgnosis Songs Fund said it was considering another round of fund raising next year for acquisitions as it reported a rise in half-year net income.

The company, which has been on an aggressive song catalogue buying spree this year, said it was in talks on a deal pipeline with an acquisition value of £1bn. It has already raised £426m in two tranches this year.

Net income from the fund’s portfolio rose to £44.8m from £23.2m. A second interim dividend of 1.3125p per share was declared. Pre-tax operating profits fell to £12m from £12.6m while total revenue more than doubled to £50m from £22m.

Hipgnosis said it continued to see “attractive pricing on catalogues of the finest quality” and was exploring the best was to fund further investments, including a potential equity raise.

In the the six months to September 30, the fund bought 63 catalogues, including classic tracks such as Fleetwod Mac's ‘Go Your Own Way’, Rick James' "Super Freak", Steve Winwood’s ‘Higher Love’ and The Spencer Davis Group’s ‘Gimme Some Lovin’.

In the half-year, operative net asset value increased by 7.4% to 125.35p while the fair value of all catalogues increased by 10% to £114m excluding losses of £23.3m due to forex headwinds.