Colonial First State Global Asset Management’s (CFS) new media fund would be valued at between $100-200 million when it launches near the end of this year, according to Geordie Manolas, head of strategy and development.
Yesterday CFS revealed it had bought Dimensional Music Publishing, which holds the copyright for 25,000 songs, as the media fund’s first asset but Manolas said other deals, including a film library purchase, were “in the pipeline”. “We’re looking to buy more media copyright assets… the portfolio should hold assets worth between $100-200 million by the time we launch,” he said. Manolas said the group was still “ironing out” the media fund’s structure but it would be previewing it with institutional investors soon. “The assets have a long life and predictable returns, which makes them attractive to institutional investors,” he said. But Manolas said CFS was also considering whether to open the media fund up to retail investors and how to manage the differing liquidity demands if it did so. The Dimensional song copyright assets, which include such chestnuts as ‘Afternoon delight’, ‘Day-O’, ‘Leaving on a jet plane’, Bob Marley’s ‘Get up, stand up’, the Byrds back catalogue as well as a raft of country music and more contemporary compositions, will be managed by CFS joint venture First State Media. Manolas said First State Media chief, Steve McMellon, is a “world expert” in copyright valuation and headed a specialist team. “They have the right networks to line up further deals and also the ability to promote the assets further,” he said. CFS also owns a copyright royalty collection agency dubbed State One Music which will control revenue flow into the media fund. “That means that the day the royalties get paid is the same day the fund gets paid,” Manolas said. “If a third-party collects the royalties it can take up to a year before you get paid.” Dimensional Music Publishing was a division of New York-based hedge fund manager JDS Capital management. JDS was reported to have paid US$50 million in 2004 for Dreamworks Music Publishing, part of the Disney empire, which it folded into Dimensional. According to online site Billboard.biz, the Dreamworks deal was the first time a private equity fund investing primarily in technology-based services had moved into music publishing.
Since taking over the top job at the $44 billion Funds SA more than a year ago, chief executive John Piteo has ushered in an investment function overhaul and wrapped up an important stage of the fund’s five-year data transformation program. It pledges to recentre around investment performance and more efficient processes, as the “missing piece” has been found in incoming CIO Con Michalakis.
Darcy SongJanuary 10, 2025
