Ahead of crucial shareholder votes on the proposed sale of Hipgnosis Songs Fund to Blackstone, Merck Mercuriadis, founder and chairman of Hipgnosis Song Management, has announced his plans to leave the company. Hipgnosis shared this significant update this morning, just days before investors will vote on whether to approve the sale to Blackstone’s Lyra Bidco.
Given investors’ known concerns with Hipgnosis management—HSF’s continuation was decisively rejected last year—the timing of this announcement seems far from coincidental.
Mercuriadis’ complete departure (he shifted from HSM’s CEO to chairman in February) “will be effective upon closing of the proposed acquisition” with Blackstone, according to the parties involved.
The votes are scheduled for six days from today. Despite the possibility that hedge funds might try to block the transaction to secure a higher sale price, Mercuriadis could leave Hipgnosis in less than a week.
Mercuriadis had little to say about the specifics of his departure, instead using around 200 words to express optimism about Hipgnosis’ future. “Six years after founding HSM,” he stated, “I have decided that now is the right time for me to step back from my role as Chairman. This is a timely opportunity for me to undertake a strategic shift of focus and to spend more time advocating on behalf of songwriters to ensure they are properly compensated for their work.”
He praised the “outstanding catalogue of rights” owned by Hipgnosis and emphasized his ongoing commitment to advocating for songwriters. “As Hipgnosis Songs Fund enters the next phase of its development,” he concluded, “now is the right time to hand the reins to a trusted and highly capable team. I am excited about the company’s future and its ongoing success with the support of Blackstone.”
Meanwhile, Ben Katovsky will remain as HSM’s CEO. In his own statement, Katovsky commended Mercuriadis’ “instrumental” role in building Hipgnosis. “Merck’s vision and passion in creating Hipgnosis, assembling an extraordinary portfolio of iconic songs, and campaigning for songwriters to be fairly paid have been instrumental in Hipgnosis’ journey to date. I am grateful for his support and the trust that has been placed in me and the HSM team to build on his passion. We remain committed to bringing the iconic songs in our care to new audiences and ensuring that they enjoy the ongoing success and attention they so richly deserve.”
Unsurprisingly, all eyes are on the upcoming votes, which were already significant but now hold even greater importance following Mercuriadis’ announcement. At the time of writing, the news had not significantly impacted HSF’s stock price, which remained around $1.30 per share.
