After months of hypothesis, Hipgnosis Songs Fund (HSF) has formally held a pair of shareholder conferences, the place traders voted overwhelmingly towards the entity’s proposed 29-catalog selloff in addition to its continuation.
HSF acknowledged the votes’ outcomes early this morning, on the heels of ample controversy and no scarcity of stakeholder criticism. Although traders had for a while expressed grievances with the operational type and decision-making of Hipgnosis management, their opposition appeared to develop when execs revealed the sudden cancellation of a dividend 10 days in the past.
Consequently, whereas public feedback from top-10 HSF traders indicated {that a} vote towards the $440 million catalogs sale was possible, comparative uncertainty surrounded the vote on the Hipgnosis continuation itself.
As initially talked about, nevertheless, traders felt inclined to reject not solely the proposed sale (the worth and phrases of which had been unfavorable, a number of had beforehand communicated) however the measure permitting for the continuing operation of HSF as effectively.
Because of the latter – which over 83 p.c of votes opposed – HSF’s board is about to “put ahead proposals for the reconstruction, reorganisation or winding-up of” their Fund for shareholders’ “approval inside six months,” the enterprise drove house in its formal launch on the matter. These proposals, the corporate emphasised, might in the end contain “liquidating all or a part of the” music rights at hand.
For sure, it’ll be price carefully monitoring this course of all through the following half of a yr. Furthermore, it needs to be reiterated that HSF one week again urged its Blackstone-powered “funding adviser,” a part of which belongs to Merck Mercuriadis, to axe the portion of their settlement entitling the adviser to scoop up HSF’s “portfolio on termination of its contract.” After all, the adviser denied the request.
In an announcement, HSF senior unbiased director Sylvia Coleman famous the votes’ outcomes and took the chance to underscore the perceived “inherent high quality and potential of those property.”
“Whereas shareholders haven’t supported our proposed transaction or the continuation vote,” Coleman mentioned partially, “it’s clear that they share our perception within the inherent high quality and potential of those property. The Administrators at the moment are expediting the appointment of a brand new Chair who will drive the Strategic Overview we’ve already introduced, with a transparent give attention to delivering improved shareholder worth.”
Moreover, forward of at the moment’s conferences (and votes on their standing as board members), Andrew Wilkinson and Paul Burger resigned, HSF mentioned. Increasing upon Coleman’s point out of discovering a brand new chair, over 71 p.c of votes forged opposed Decision 5, HSF relayed – which means that now-former chairman Andrew Sutch, who was in any occasion anticipated to step down, not holds the function.
On the time of this writing, HSF inventory, at 77 pence (at the moment 93 cents) per share, was up about three p.c on the day.