Last October, music company Concord was reported to be touting itself to potential acquirers with an asking price of up to $4bn. It seems that figure may have been too low – at least for Concord’s expectations.
Bloomberg reported yesterday that the company has “turned down offers of $4.5 billion and $5 billion” according to sources in the know, and suggested that – egged on by advisers Goldman Sachs – Concord may be holding out for $6bn in any deal.
This isn’t just idle gossip. “We got some very strong bids, and we passed on all of them,” Concord’s CEO Scott Pascucci told Bloomberg in the piece, adding that the company has yet to receive an “extraordinary plus” offer. Which, of course, an article in a prominent business outlet may help to smoke out.
However, Concord may not be quite so happy with the fact that said article runs with “The music catalog boom may be coming to an end” as its headline, warning that “the market may have hit a ceiling due to inflation and rising interest rates”.
Entertainment and tech industry history has no shortage of cautionary tales where companies knocked back big acquisition offers in the hope of attracting even bigger ones that never materialised.
That said, with Concord reportedly a $500m business in terms of annual revenues, selling is hardly a do-or-die decision. However, it’s interesting to see speculation that the previously-booming catalogue sales market could turn into something of a game of chicken between buyers and sellers.
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