Brookfield Asset Management is the latest to join the music catalogue rush. The company has acquired the copyrights to Whitney Houston’s global jams “How Will I Know” and “I Wanna Dance With Somebody (Who Loves Me)” as part of a $2bn music royalty partners deal with publisher Primary Wave.
The group purchased the rights to 60 songs written by Shannon Rubicam and George Merrill, the duo behind the two Houston smash hits, for an estimated $50mn and $100mn, according to people familiar with the matter reported the Financial Times.
Houston died 10 years ago at age 48, the night before the 2012 Grammy Awards. At the time of her death the superstar vocalist was one of the highest selling artist of all time with over 150 million records sold and many sold out tours. Since then her estate in partnership with Primary Wave Music, have been keeping her legacy alive.
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Head if her former record label Clive Davis says he would like to see the legacy of Whitney Houston be given justice.
“Her documentary [Whitney, 2018] was inaccurate. A television bio of her life was inaccurate. So there needs to be an accurate film of her life that does it all right, and without whitewashing her drug addiction.”
“I’m certainly committed to preserving the legacy of Whitney,” Davis tells Avenue Magazine.
Without disclosing the exact amount Primary Wave said the purchase of Rubicam and Merrill’s songs is “one of the larger acquisitions we have done,” said Larry Mestel, chief executive of Primary Wave, which is managing the Brookfield-funded investment vehicle.
Primary Wave who recently acquired the estate of James Brown and a piece of the Marley catalogue through a 2018 partners but in to Chris Blackwell’s Blue Mountain Publishing also partnered up with Houston’s estate in 2019, taking a 50% stake.
“It was time to rebuild Whitney’s business and Primary Wave, with its arsenal of industry professionals, were the right fit, a team packaged to elevate Whitney’s legacy to the next level,” says Pat Houston inna statement first carrier in Variety. Pat is the late artist’s sister-in-law and former manager, who serves as an executor of her estate.
“We have massively, over the course of our three-year partnership, improved the earnings of the estate,” adds Primary Wave founder and CEO Larry Mestel. “We’ve basically quadrupled the earnings stream of the estate through a lot of low-hanging fruit: renegotiation of partnerships, focusing on merchandise, digital strategy and social media enhancement — upping the game in general.”
As streaming becomes more integrated, the music business has transformed making the royalties generated by songs appealing investments especially while interest rates were historically low.
We have seen Pimco, Blackstone, HarbourView and Apollo entered or increased their stake in the market, turning music copyrights into asset class similar to bonds because they generate consistent cash flows.
“Prices have softened a bit over the past three months or so, but not at the highest end of the market,” said Mestel. “It’s like a Basquiat or a Warhol. These are very unique pieces of art that happen to generate substantial income,” he told the Financial Times.
