Justin Bieber nears $270m catalogue sale to Blackstone-backed group

Pop star Justin Bieber is set to score a massive deal that would put his music rights under the ownership of Hipgnosis Song Management, an investment entity backed by Blackstone, according to people familiar with the matter.

Bieber's stake in his publishing rights and recorded music catalogue could fetch about US$200 million (S$270 million), said the sources, who asked not to be identified because the discussions are private.

While the parties are working towards a deal, an agreement has not been signed and nothing is imminent, one of the sources said.

Representatives for Bieber could not be immediately reached, while representatives for Hipgnosis and Blackstone declined to comment. The potential deal was reported on Wednesday by The Wall Street Journal.

Bieber, 28, rose to fame when he was 15 years old following the success of his song Baby (2010). The Canadian singer disclosed in June that he was diagnosed with Ramsay Hunt Syndrome, which left half of his face paralysed, forcing him to cancel his performances.

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Hipgnosis has been one of the main drivers behind an uptrend in music catalogue sales. The sector has grown more popular with private equity giants like Blackstone and Apollo Global Management pursuing deals in the space more intently.

Partnership struck

Last year, Blackstone struck a partnership with Hipgnosis and vowed to commit an initial US$1 billion to launch a private vehicle called Hipgnosis Songs Capital, created to acquire music rights and manage catalogues.

But investors who had initially sought this asset class as a place to store excess capital have now seen deals in the space retreat, given the tightening global economy and as catalogue backers look for more ways to put music rights to work. 

Still, a potential deal for Bieber's music rights could rank among the highest around.

Catalogues of Kenny Chesney, Leonard Cohen and Justin Timberlake are among those acquired by Hipgnosis and Blackstone.

Timberlake, 41, sold the rights to his songs, including hits such as Cry Me A River (2002) and Rock Your Body (2003), to Hipgnosis Song Management in May.

John Legend, Bruce Springsteen, Stevie Nicks and Bob Dylan have also struck deals with other firms.