Banking

Round Hill Music Royalty fund diversifies exposure with acquisition of The O’Jays’ catalogue

The board said that Round Hill’s acquisition will diversify its portfolio, giving it increased exposure to classic R&B and soul.

Streaming accounts for 64% of revenue mix in the catalogue, with the balance being comprised of 3% physical, 10% download, 17% sync, while 6% comes from other sources, according to the catalogue’s royalty statements in the calendar years 2018-2020.

In terms of geographical exposure, 88% of the revenue is from the US, while the balance is from other countries, it said.

Round Hill Music Royalty Fund makes first acquisition as it explores further fundraising

The board stated: “Due to commercial sensitivities, the company is unable to disclose financial details for each acquisition as it occurs.

“However, on completion of the investment of proceeds from the C Share fundraise of $86.5m, together with the remaining undrawn balance of its existing revolving credit facility, the company will make further financial disclosure on the acquisitions.”

Ranked by revenue, The O’Jays’ top songs are “Love Train”, “Forever Mine” and “For The Love of Money”, which was used as the theme song for the US reality show The Apprentice.

The band made their first chart appearance with the song “Lonely Drifter” in 1963.

Fund chair Trevor Bowen said: “The acquisition further demonstrates the ability of Round Hill to source and acquire catalogues which have produced long-term steady royalty revenue over the past decades.

“The addition of the O’Jays’ catalogue provides further diversification in terms of artist, genre, vintage and income type, making it a welcome addition to our growing portfolio. We are delighted to see the investment manager competently executing on its pipeline of attractive opportunities.”

Josh Gruss, chair and CEO of Round Hill, the company’s investment manager, said that The O’Jays are known to many as “one of the main figures in the 70s soul scene in Philadelphia”.

“We are pleased to be able to secure this exceptionally high quality catalogue, which will make a fantastic addition to the landmark portfolio of timeless music we are constructing for RHM, to support predictable and consistent revenue streams,” Gruss added.

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