Hipgnosis Songs Fund has had a roller-coaster year — and it's not over yet.

What went down this year and how did it all go awry for Hipgnosis? Following its IPO in 2018, Hipgnosis embarked on a bullish spending spree to beef up its catalogues. It spent nearly $2bn (£1.5bn) on over 64,000 rights to hits by pop icons such as Dua Lipa, Taylor Swift, and Fleetwood Mac.

Towards the end of this period, in late 2021, asset manager Blackstone took an ownership stake in Hipgnosis Song Management (HSM), an adviser to the eponymous arm.

After the pandemic, Hipgnosis enjoyed a honeymoon period, as the music industry cashed in on a boom in the value of music rights, spurred on by the continued popularity of streaming platforms.

Hipgnosis shares peaked in November 2021 at a high of 129p with investors rushing to get a slice of the trendiest fund.

But everything really began to come crashing down this year.

As the share price showed no signs of climbing, strangling fundraising efforts, investors urged the fund to sell some of its catalogues.

In October it scrapped an interim dividend payment due to concerns it would have to breach the terms of its debt covenants.

This was due to a change in rates by the US Copyright Royalty Board, meaning that independent portfolio valuer, Citrin Cooperman, had to significantly lower industry-wide payment expectations.

After a rocky year, the future of Hipgnosis is touch-and-go and Mercuriadis' position is tenuous, as he could be fired by the new board to appease angry shareholders.

(c) 2023 City A.M., source Newspaper