Tomorrow (October 26) is a big day for UK-listed Hipgnosis Songs Fund.
HSF’s shareholders will tomorrow morning (London time) vote on whether to keep the fund continuing in its present form via a so-called ‘continuation vote’.
(The continuation vote, which has been scheduled to take place this month since 2018 – i.e. five years since HSF’s IPO – is a legal requirement for investment trusts in London, according to the FT.)
In addition, HSF shareholders are set to vote tomorrow on whether to accept a $440 million offer made by Blackstone-backed Hipgnosis Songs Capital to acquire 29 catalogs from HSF.
Before all of that plays out, HSF has today (October 25) sent out a note to investors confirming that two of the company’s non-exec directors have resigned.
Andrew Wilkinson and Paul Burger have both stepped down from their non-exec roles at the company.
The news comes after HSF confirmed last month that the Chairman of its current board, Andrew Sutch, is to step down from his role, and that a process had begun to find his replacement.
Sutch said today: “On behalf of the Board, I would like to thank Andrew and Paul for their commitment and important contribution to the Company over the past five years.”
The resignation of Wilkinson and Burger negates the need for a shareholder vote on whether they should both stay in their current non-exec roles – something that was also previously set for tomorrow.
According to the FT, Sutch, Wilkinson, and Burger were expected to “face opposition from shareholders at the company’s annual shareholder meeting”.
Whispers are growing louder that there’s a reasonable chance that Hipgnosis Songs Fund shareholders will vote against continuation tomorrow – though it’s not a foregone conclusion.
One preferred outcome of some shareholders, we hear, would be a brand new board to take over the running of HSF.
Meanwhile, if ‘discontinuation’ happens, it will leave the way clear for a six-month period in which invested parties will decide on a new path forward for HSF and its portfolio.
HSF’s current investment adviser, Hipgnosis Song Management – led by Merck Mercuriadis – has a “call option” that means it can acquire the portfolio of HSF at a pre-agreed price in case of HSM’s termination.
In addition to HSF, HSM is the investment adviser for the Blackstone-backed Hipgnosis Songs Capital, a private fund.Music Business Worldwide