sold his music rights to Sony Music Group for between $500 million and $600 million in a deal representing the largest transaction ever for the life’s work of an individual artist, according to people familiar with the matter.
Various financial players looked at backing the transaction, according to people familiar with the deal, with private investment firm Eldridge Industries LLC putting up a portion of the funds for part of the deal, yet another financial player to make a big move in the frothy market for music copyrights. Sony Music Group is a division of Japanese conglomerate
Sony Group Corp.
The deal gives Sony, the second-largest music label company and largest music publisher, ownership of classic hits including “Born to Run,” “Born in the U.S.A.” and “Dancing in the Dark.” Sony said its publishing arm partnered with Eldridge on the purchase of Mr. Springsteen’s songwriting catalog.
The approximately $500 million valuation represents more than 30 times the annual royalties on the combined recorded music and songwriting catalog—an aggressive bid that kept Mr. Springsteen’s camp in exclusive talks with Sony instead of looking for a buyer on the open market, according to the people. Sony has been the Boss’s record label home for his entire career.
Billboard earlier reported news of the sale.
Mr. Springsteen’s sale follows an onslaught of other artists seeking to sell their music catalogs at valuations as high as 20 times their annual royalties as revenue from streaming music has grown with the popularity of services from
Spotify Technology SA,
sold his entire music catalog to Universal Music Publishing Group in a transaction said to be worth $300 million to $400 million.
sold a majority stake in her songwriting catalog valued at about $100 million.
The Boss joins a cast of classic artists seeking to secure their legacies with partners they believe will take care of their life’s work, while also taking advantage of attractive financial conditions. He could benefit from a significant tax benefit for songwriters selling their rights. A special provision for musicians that sell self-created works means they owe capital-gains tax rates of 20% on the sale. That is instead of owing ordinary tax rates of up to 37% each year on the royalty income they get from streaming, licensing and other uses of their works.
Timing is important, as President
Build Back Better bill, currently stalled in Congress, would impose a 5% tax on adjusted gross income above $10 million and an additional 3% on income above $25 million—changes that could take effect at the beginning of January, incentivizing deals to get done before then.
Mr. Springsteen, a New Jersey native who was initially touted as a “new Dylan,” is among the most popular rock stars of the past 50 years.
Known for his literary flair, sweeping arrangements and reverence for tradition, Mr. Springsteen has long been an evangelist for the power of rock ’n’ roll and …….