Brookfield Asset Management has acquired the copyrights to Whitney Houston’s hit songs “How Will I Know” and “I Wanna Dance With Somebody (Who Loves Me)” as part of a $2bn push into music royalties in partnership with publisher Primary Wave.
The group bought about 60 songs written by Shannon Rubicam and George Merrill, the duo behind the two Houston smash hits, for between $50mn and $100mn, according to people familiar with the matter. Rubicam and Merrill also performed their own songs as a duo named Boy Meets Girl, such as “Waiting For A Star To Fall”, released in 1988.
Brookfield is the latest financial giant to enter the song-buying market, having last month announced it would team up with Primary Wave to set up a $2bn vehicle for deals.
Primary Wave did not disclose the price of the Rubicam and Merrill purchase. “It’s one of the larger acquisitions we have done,” said Larry Mestel, chief executive of Primary Wave, which is managing the Brookfield-funded investment vehicle.
The rise of streaming on platforms such as Spotify has transformed the music business, making the royalties generated by songs an appealing investment while interest rates were historically low in recent years. Large investors such as Pimco, Blackstone and Apollo have entered or increased their exposure to the market, viewing music copyrights as similar to bonds because they generate consistent cash flows.
As a result, song valuations have soared, although prices have recently fallen due to rising interest rates.
“Prices have softened a bit over the past three months or so, but not at the highest end of the market,” said Mestel. “It’s like a Basquiat or a Warhol. These are very unique pieces of art that happen to generate substantial income.”
Houston, who died in 2012 at age 48, was one of the most successful stars in pop music history, selling more than 170mn records. After signing with music mogul Clive Davis, she went on to record a string of pop-soul hits through the 1980s, including the chart-topping album Whitney, which included the popular single “I Wanna Dance with Somebody (Who Loves Me).”
After buying a 50 per cent stake in Houston’s estate in 2019, Primary Wave has been working to boost the income generated by the late singer’s music through branding and entertainment deals. The group has produced a biopic, to be released next month through Sony Pictures, and attached Houston’s name to perfume and cosmetics lines.
Mestel is also working to create a Broadway show around Houston’s work, and the acquisition of two of her biggest hits is a “big part” of that project.
As part of last month’s deal, Brookfield has taken a minority stake in Primary Wave, which owns the songwriting catalogues of musicians such as Stevie Nicks, James Brown and Ray Charles.