Francisco Partners has acquired Kobalt, an independent music publisher, in partnership with the company’s current owners and senior management team.
Kobalt was founded in 2000 by Swedish entrepreneur Willard Ahdritz, the company’s current chairman, to improve efficiency, accuracy, and transparency across the billions of micro-payments collected in the music industry. In 2000, the music industry was being disrupted by online file-sharing companies, such as Napster, which were later found to be violating music copyrights.
In June 2015, Kobalt acquired American Mechanical Rights Agency (AMRA), one of the main music royalty collection agencies in the United States. Despite its geographically specific name, AMRA now operates in multiple global markets to track plays across numerous streaming platforms and other sources of digital music.
Post-closing, Mr. Ahdritz will continue as Kobalt’s chairman and the company will continue to be led by its existing management team including CEO Laurent Hubert, President and COO Jeannette Perez, CFO Catrin Drabble, and CTO Nuno Guerreiro. New York City and London-headquartered Kobalt has more than 700 employees and 13 worldwide offices.
“For over 20 years, Kobalt has been a music leader with technology as a core part of our focus, and I can’t think of a better investor than Francisco Partners to back our vision and invest deeply in our ambitious technology development and creator services,” said Mr. Ahdritz. “Having known the team at Francisco Partners for two years, I am excited to invite them into the Kobalt family.”
Francisco Partners makes investments in technology companies with transaction values ranging from $20 million to $3 billion. Transaction structures include buyouts, divisional divestitures, recapitalizations, restructurings and growth equity financings. Francisco Partners was founded in 1999 and is headquartered in San Francisco with additional offices in New York City and London.
“Our investment should help bring more resources, experience, and alignment to continue to build Kobalt as a premier destination for creators, further grow AMRA as the only global digital licensing platform, and support and invest in technology innovation across the entire Kobalt ecosystem to address the needs of creators and publishers,” said Matt Spetzler, a partner at Francisco Partners.
Co-investing in this transaction alongside Francisco Partners is MUSIC (a joint venture between Matt Pincus (the founder of SONGS Music Publishing), LionTree, JS Capital Management and Schusterman Family Investments) and Dundee Partners.
“We believe Kobalt is and should be the premier platform for independent creators, and we look forward to helping them achieve this both organically and inorganically,” added Mario Razzini, a partner at Francisco Partners.
Goldman Sachs was the financial advisor to Kobalt, and Raine Group was the financial advisor to Francisco Partners.
© 2022 Private Equity Professional | September 13, 2022
