A fund backed by alternative asset management major Blackstone Inc. (NYSE: BX) has acquired the rights to singer and songwriter Justin Timberlake’s song catalog for $100 million.
Following the news, shares of the company jumped over 6.5% on Thursday. The stock, however, pared its gains slightly to close at $118.27 in the extended trading session.
Details of the Deal
The deal was completed in collaboration with a music-investment company, Hipgnosis Song Management Ltd., with whom Blackstone had formed a partnership in October last year and committed an initial corpus of $1 billion to launch a private vehicle called Hipgnosis Songs Capital.
The deal will allow Hipgnosis Songs Capital to have full ownership and control of Timberlake’s 200 songs (approx), which he composed, wrote or performed as a boy-band frontman, a solo artist and for movie soundtracks.
Stock Rating
Recently, Deutsche Bank analyst Brian Bedell reiterated a Buy rating on the stock. The analyst, however, lowered the price target from $182 to $180, which implies upside potential of 52.2% from current levels.
Overall, the Street is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on six Buys and four Holds. Blackstone’s average price target of $147.56 implies that the stock has upside potential of 24.7% from current levels.
Investors’ Stance
TipRanks’ Stock Investors tool shows that top investors currently have a Very Positive stance on BX. Further, 3.6% of the top portfolios tracked by TipRanks have increased their exposure to BX stock over the past 30 days.
Conclusion
Blackstone’s move to add Justin Timberlake’s song catalog to its portfolio will allow the company to gain a strong foothold in the music rights industry, paving the way for such future deals.
Read full Disclosure
