The Carlyle Group is close to finalising a $464m bond issuance backed by music royalty rights from a range of international artists including Katy Perry, Keith Urban, and Benny Blanco, according to a report by Bloomberg.
The report cites unnamed sources familiar with the matter as revealing that the bond sale – three times oversubscribed – is being driven by robust demand from insurers and asset managers seeking long-duration private credit exposure. The 40-year maturity bonds, which carry a five-year anticipated repayment schedule, are backed by a music catalogue valued at over $750m.
The deal marks the first securitisation by Litmus Music, Carlyle’s music rights platform launched in 2022 in partnership with industry veterans Hank Forsyth and Dan McCarroll. Carlyle committed $500m in equity and debt to the venture, targeting high-profile publishing and master recording assets.
Proceeds from the bond issuance will be used to refinance existing liabilities tied to the catalogue and return capital to Carlyle’s shareholders via a dividend distribution.
The move reflects a broader pivot among large-cap private equity managers into asset-based finance, as the maturing private credit sector pushes beyond traditional corporate lending into structured deals backed by royalties, intellectual property, and other non-traditional collateral.
Carlyle joins a growing list of private capital firms deploying capital into the music royalties space, lured by the asset class’s long-tail cash flows and partial insulation from macroeconomic volatility. While portfolio valuations have come off their pandemic-era highs amid slower streaming growth, institutional demand for music-backed debt remains strong.
Similar recent activity includes Blackstone-backed Hipgnosis Song Management’s $1.47bn bond issue and private financings involving Ares Management and HPS Investment Partners, who backed Hellman & Friedman’s acquisition of Global Music Rights last year.
