The response to the proposals from shareholders has so far been lukewarm, with the trust’s share price up less than 0.3%.
In a stock exchange notice on Thursday (14 September), the trust said it had agreed to sell 29 catalogues for $465m to Hipgnosis Songs Capital, the Blackstone-backed private fund managed by SONG investment adviser Hipgnosis Song Management.
Using the proceeds from the catalogue sales, the board also outlined a share buyback programme of up to $180m and the repayment of $250m drawn under the trust's revolving credit facility, as well the introduction of additional, lower investment advisory fee tiers.
Hipgnosis agrees $465m catalogue sale from public trust to private Blackstone vehicle
The move comes more than two months after the board first revealed it had beenconsidering strategic options to re-rate the trust's share price ahead of its five-year continuation vote, which is set to take place over the coming month.
SONG had been facing additional pressure to deliver a compelling offer to shareholders this week after Round Hill Music Royalty fund (RHM), its closest peer, announced it had agreed to a $468.8m takeover offer by Concord.
The response to the proposals from shareholders has so far been lukewarm, with the trust's share price up less than 0.3%, according to data from Morningstar Direct. SONG's discount has widened to almost 38% after narrowing to a twelve-month low of 36% on Monday (11 September).
Given shareholders and analysts had been calling for Hipgnosis to implement these measures, Matthew Read, senior analyst at QuotedData, toldInvestment Week the details provided are «certainly a positive step».
However, he said it would have been beneficial to shareholders to see a third-party offer
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