Justin Bieber, Ariana Grande & J Balvin to Reap Millions in HYBE Deal to Buy Ithaca Holdings

HYBE’s $1.05 billion deal to buy Scooter Braun’s Ithaca Holdings will award Braun’s artists and staff with more than $40 million in equity, including shares to Ariana Grande, Justin Bieber, J Balvin and Demi Lovatoaccording to a corporate filing from HYBE, the publicly traded company formerly known as Big Hit Entertainment.

total of 39 people, including Braun and Big Machine Label Group CEO Scott Borchetta, will receive shares totaling about $161 million, based on the current exchange rate. Braun will get 462,380 ($86.2 million), while Borchetta will receive 166,537 ($31.1 million); and Grande and Bieber will each receive 53,557 shares, or almost $11.0 million apiece, the company filing states.

Balvin will get 21,423 shares ($4.1 million) and Lovato will receive 5,355 shares ($1.06 million) . The remaining 33 individuals listed are a mix of artists, executives and existing Ithaca shareholders.

This isn’t the first time artists have received shares from HYBE. When the company went public last October on the Korean stock exchange, the seven members of BTS each got shares valued at $8 millionBut sources say the equity being awarded to Ithaca’s artists is coming out of Braun’s stake.

HYBE, the company behind powerhouse K-pop group BTS, said Friday (April 2) that it would pay $1.05 billion in cash and shares to acquire Ithaca Holdings, in a move designed to help the Korean company establish a strong U.S. presence in music and entertainment while also heightening its profile for American financial investors. According to terms of the deal, which is expected to close in about a month, Braun will join the board of HYBE and Borchetta will remain CEO of Big Machine Label Group.

The deal marries Big Hit Entertainment’s management company and labels with Ithaca’s entertainment holdings, which include the Big Machine label, the SB Projects management company and its interests in film and gaming through Mythos Studios and 100 Thieves Gaming. 

Since going public in October, HYBE has leveraged the global sway of BTS to do a series of acquisitions of smaller labels, joint ventures and strategic partnerships with South Korean and U.S. labels, including with Universal Music Group. The deals have brought the company steadily closer to the U.S. market and to founder and CEO Bang Si-Hyuk’s goal to build HYBE into an international entertainment conglomerate.

In February, HYBE and Universal announced the Korean company would create a joint label with Geffen Records and co-produce an American Idol-like show to search for the next global K-pop boy bandThe new label will be run out of Los Angeles, where HYBE plans to open a newly expanded U.S. office later this year.

For HYBE, Ithaca Holdings will relieve pressure on the company to diversify its artist roster beyond BTS, which pulled in 97% of the company’s sales in 2019, especially with required military service for the group’s oldest members still looming in two to three years.

The Ithaca Holdings deal was announced after the Korea Stock Exchange close of trading Friday, in which HYBE’s shares — which still trade under Big Hit Entertainment – closed at 243,000 KRW ($214.97) per share, giving the company a market capitalization of 8.5 trillion KRW ($7.27 billion), down slightly from the 8.7 trillion KRW valuation in its first day of trading on Oct. 15.

Besides paying with Big Hit shares, HYBE is using at least $100 million in debt to finance the deal, according to a HYBE filing. The stock shares likely come with a lock-up period, which means the recipients can’t trade them until a certain specified date.

Financial music executives said they were stunned by the Ithaca valuation, especially after Braun and Ithaca’s financial backer, the Carlyle Group, sold the crown jewel of the Big Machine labels — Taylor Swift’s catalog — to Shamrock Holdings for an estimated $300 million last November. That was 16 months after they bought Big Machine.

In the Big Machine acquisition, sources say Ithaca acquired 80% of the company in a deal that gave Big Machine about a $380 million valuation, leaving Borchetta and possibly some of his investors with a 20% stake that was apparently converted into shares of Ithaca.

Besides the Swift catalog, the Big Machine labels also will bring HYBE music from Florida Georgia Line, Carly Pearce, Lady A, Jennifer Nettles, Rascal FlattsSugarland, Sheryl Crow, Thomas Rhett, Tim McGraw, Brantley Gilbert and the Eli Young Band.

Previously, Billboard estimated that Big Machine averaged about $100 million in revenue over the period of 2015-18, with almost $40 million in earnings before interest, taxes, depreciation and amortization. But since the Swift catalog generated so much of the revenue, she also was responsible for an outsized profit-margin contribution — almost three-quarters of overall EBITDA, Billboard calculated.

Since Borchetta sold Big Machine to Ithaca, prices for music assets have escalated considerably, with Universal Music Group achieving a 30 times EBITDA multiple from its deal with Tencent Music Entertainment. UMG is expecting an even higher multiple from its planned stock offering later this year.

Considering those multiples, Billboard projected that at the top end that could mean a $950 million valuation for just Big Machine alone. But that was before Ithaca sold Swift’s catalog to Shamrock Holdings for about $300 million. Without the Swift catalogBig Machine is worth half as much — anywhere from $300 million to $650 million. That means the rest of Ithaca’s holdings in technology, film and gaming have contributed a significant portion of Ithaca’s valuation.

Regardless, the Carlyle Group may emerge as the biggest winner in the deal. Ithaca Holdings and HYBE said Friday that Carlyle will sell its significant minority stake in Ithaca, after initially investing in the company in 2017.

Even before the Swift catalog was sold off, sources suggest Carlyle was the sole beneficiary of the $300 million that Shamrock paid for the Swift catalog.

With Big Machine and SB Holdings, HYBE will significantly enhance its U.S. holdings. And the combined management and label rosters of Bieber, BTS and Grande will give HYBE more firepower in the entertainment lifestyle marketplace.

The deal could also mean that HYBE is inheriting a potential Swift headache. The pop star expressed her displeasure last year upon learning that Braun owned her catalog through the Big Machine acquisition. She said she had wanted, but was never offered, a chance to buy back her catalog. She subsequently denounced the deal and all those involved in it. She continues to own her own publishing. 

Diddy Beams Into Son’s 23rd Birthday Party Via Hologram: See Video

Diddy pulled double-duty Thursday night by beaming into son King Combs’ 23rd birthday in LA while he was in Miami for business.

TMZ released a two-minute video of the “I’ll Be Missing You” MC’s lifelike appearance at the sports jersey-themed soirée on the other coast. The hip-hop mogul used PORTL — an interactive hologram machine founded by David Nussbaum that Kane Brown used during his 2020 iHeartRadio Music Festival performance — to beam into the party.

Diddy sang “Happy Birthday” to “my life, my twin, my baby boy, my heart, my soul, my everything,” getting down on his knees for his grand proclamation to King (born Christian Combs). Meanwhile in Miami, Diddy’s daughters Jessie, D’Lila and Chance crashed the party virtually as well.

“I just want to tell you how much of a blessing it is that you’re my son. I feel like the coolest dad in the world just ’cause you’re my son,” the 51-year-old rapper said in his speech. “Every day that I see you, you taught me how to smile. And I just want to tell you I love you for that, for being my son. And I’m the proudest dad in the world.”

Lil Wayne, Chris Brown, Snoop Dogg’s son Cordell Broadus, Swae Lee, Winnie Harlow and Young Thug were reportedly among the in-person attendees at Thursday night’s birthday bash.

On Instagram, Diddy shared a sweet father-son portrait for King’s big day. “Happy happy happy birthday to my King, my son, my twin, my love @kingcombs !!!” he captioned the picture. “I love you with all my heart and soul forever and ever and ever!! Lets f—ing go King!!”

“I LOVE you too!!!” the “Diana” rapper commented. “Let’s get it!!!”

Get a taste of Diddy’s birthday surprise below:

Black Keys’ Patrick Carney to Fill In for Cleveland Indians’ Ballpark Drummer

The Indians will use a pinch-drummer for their home opener.

With longtime drummer and ballpark fixture John Adams recovering from heart surgery and unable to attend his first opener in Cleveland in 48 years, Black Keys drummer and lifelong Indians fan Patrick Carney will fill in and pound away from the left-field bleachers at Progressive Field during Monday’s game against Detroit.

“When I found out that John Adams wouldn’t be able to make Opening Day in Cleveland for the first time in almost 50 years, I reached out to the team,” Carney said. “I share John’s love of baseball and the Cleveland Indians franchise, and drumming for him during the home opener when he can’t physically be there feels like a meaningful way to show John the love and respect he deserves.

“I want to be there for John.”

The Indians said Adams, who first started banging away on his drum in 1973, will bestow drumming duties and his bleacher seat for the day to Carney during an in-game video presentation.

A rocking duo from Akron, The Black Keys (Carney and lead singer Dan Auerbach) have produced plenty of their own hits, such as “Lonely Boy,” “Gold on the Ceiling,” “Little Black Submarines” and ’Tighten Up.”

Maren Morris Is ‘Proud’ of Her Post-Baby Body & Rejects ‘Pressure’ to ‘Snap Back’

On Friday (April 2), Maren Morris snapped back at the societal expectation to “snap back” to the body she had before giving birth to her son.

“The Bones” singer posted two pictures of herself to social media: lounging on her bed wearing a nude-colored bra and underwear set in the first and then changing into gym clothes before working out in the kitchen in the second.

“Am never saying ‘trying to get my body back’ again,” Morris wrote in the caption. “No one took it, i didn’t lose it like a set of keys. the pressure we put on mothers to ‘snap back’ is insurmountable and deeply troublesome. You are and always were a f—ing bada–. and yeah, I’m proud.”

Grammy-nominated singer/songwriter Ruby Amanfu commented underneath Morris’ post, “Tell. Them. Those ignorant attitudes need to SNAP BACK into reality. A goddess is a goddess is A GODDESS. #LessonNumber1.”

The 30-year-old country singer and her husband, Ryan Hurd, welcomed their first child on May 23, 2020. Morris has constantly championed pregnant women and mothers to love their bodies and not feel bogged down by them, especially when she performed at the Houston Rodeo while nine months pregnant last March. When she was eight months pregnant, the “GIRL” artist shared another workout picture on her Instagram Story and got down to some “real talk.”

“I’m nearing the end of my pregnancy journey and have worked out with @erinoprea and tried to eat relatively clean throughout. I’m 5’1 and have gained 40lbs, and I wouldn’t change a thing,” she wrote. “Even with the lower back pain and my anemia-prone BS, I have really enjoyed being pregnant.”

In September, the singer opened up about her battle with postpartum depression four months after giving birth in an interview with CBS This Morning. “I’m kind of coming through the tunnel now,” she said. “You’re trying to become a new mother and good parent and do everything right and you just feel like you suck at every level.”

Read Morris’ latest candid message below.

Lil Uzi Vert Hops on Posthumous FXXXXY Track ‘Yeah Kool’: Listen

A new track from late rapper-producer FXXXXY, featuring Lil Uzi Vert, arrived Thursday titled “Yeah Kool.”

FXXXXY was signed to Future’s FreeBandz label and was credited with engineering work on the song “Solitaires,” featuring Travis Scott, from the rapper’s eighth High Off Life album, released in May 2020. While working on Future and Lil Uzi Vert’s joint album Pluto x Baby Pluto, which was released in November, “he and Uzi bonded after Future ran late to their studio session. The union between both rappers ultimately led to the organic collaboration of ‘Yeah Kool,'” according to a press release.

On Wednesday, FXXXXY’s official Twitter account shared an old clip of the Dallas star teasing their collaboration in response to Uzi’s “no cap” tweet from August, when FXXXXY claimed the song is the “SONG OF THA YEAR.”

The rappers swap bars about flexing on their enemies on the Supah Mario-produced track with spacey synths.

FXXXXY (born Maudell Watkins) died in September from complications during a routine medical procedure. He was 25.

Gunna and Lil Durk appeared on his nine-track posthumous album Do You Trust Me? that dropped in December, just four months after his death.

Listen to “Yeah Kool” below.

Michael Rapino, Other Live Nation Execs Partially Forfeit Bonuses Due to COVID-19

Live Nation chief executive Michael Rapino is forfeiting approximately $4 million in stock after missing revenue targets at the concert promotion company due to the pandemic, according to a report filed with the Securities and Exchange Commission.

Rapino will forfeit 47,778 performance-based restricted shares of the company, which has been trading at an average of 16% higher than the company’s pre-pandemic period when the stock first crossed the $76 per share marker. The forfeited stock was issued in 2020 in lieu of cash payments for bonuses earned in 2019, due to “cash savings initiative in connection with the global COVID-19 pandemic,” according to Live Nation’s 2020 annual report.

Live Nation President Joe Berchtold and chief financial officer Kathy Willard also forfeited restricted stock today due to the revenue miss. A spokesperson for Live Nation told Billboard that regular stock and cash payments were also reduced as part of the adjustment. In April, Rapino announced he was reducing his salary to $0 as part of a cost-savings initiative at the company brought on by the pandemic.

In 2019, the company’s compensation committee agreed to pay Rapino a $6 million cash bonus if the company achieved an adjusted operating income of  $875.0 million, and between $6 to $12 million if he hit between 100% and 110% of the AOI target. Rapino ended up hitting 109% of his target AOI ($942 million) for a cash award of $11.4 million, which he deferred until the end of 2020. The final breakdown detailing what Rapino took in cash and stock options will be detailed later this month in Live Nation’s annual proxy statement.

Post Malone to Launch Rosé-Inspired Merch & New Maison No. 9 Bottle

Cheers to warmer weather! With springtime in full swing, so is rosé season.

In celebration, Post Malone, James Morrissey of Global Brand Equities and music manager Dre London announced on Friday (April 2) its 2021 Maison No. 9 launch, including a new vintage and merch.

The 2020 vintage rosé will be getting a new look, including an updated logo and color scheme. The merch collection will feature six pieces including t-shirts, hats and hoodies.

The launch will be available Thursday (April 8) at 12 p.m. ET. The updated vintage wine will be available to purchase on Vivino, and customers who purchase a bottle will receive a 20% discount code towards the clothing collection.

Order Posty’s original Maison No. 9 on Vivino here, or with one-hour delivery on Drizly here.

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