Shareholder blasts ‘desperate’ music fund Hipgnosis ahead of crunch vote

Hipgnosis Songs Fund faced a fresh backlash last night as a top shareholder snubbed its ‘desperate’ attempts to transform its fortunes.

The beleaguered music rights firm run by former Beyonce manager Merck Mercuriadis said it was launching a ‘strategic review’ ahead of a crunch vote on its future.

Next Thursday, investors will vote on plans to sell 29 catalogues to a Blackstone fund also run by Mercuriadis. 

Critics are concerned that the £362million price for hits, including songs by Shakira and Rick James, is too low and would not provide the best value for shareholders.

Hipgnosis yesterday said it will consider ‘all options’ for its future, including how it is managed. 

But Tom Treanor of Asset Value Investors, which has a 5 per cent stake, attacked ‘desperate stuff’ from the group.

‘The deal remains terrible and voting for it would still set an awful precedent for future asset sales,’ he said. ‘I can’t think of anyone worse qualified to hold a strategic review than this board.’

Asset Value has called for an overhaul of the board, rejecting a second ‘continuation’ vote that shareholders will also make next week.

Analysts at Jefferies said: ‘We see the initiation of a strategic review as a last ditch, and ultimately unsuccessful, attempt to sway shareholders ahead of next week’s pivotal general meetings.’ 

Founded in 2018, Hipgnosis gives investors the chance to make money from royalties of tracks by famous artists.

Its fund now owns the rights to 65,000 songs.

It made its name by scooping up the music of some of the world’s best-known musicians, from Kaiser Chiefs to Blondie.

But it has failed to keep up momentum and investors have become disgruntled with returns.

Shares fell to a record low on Monday on news it would scrap its dividend, warning that US earnings would not be as lucrative as it would have hoped.

But the stock rose 4.1 per cent, or 3p, to 76p yesterday.