Investors have thought twice and decided it’s not all right to take up an unusual bond offering backed by royalties from songs penned by Bob Dylan and other musicians.
The $300 million (€240 million) bond, known in the market as a non-traditional or “esoteric” asset-backed security (ABS), is being put together by Goldman Sachs on behalf of Sesac, a privately held performing rights organisation based in the US in Nashville, Tennessee.
Sesac holds the rights to music from Dylan; as well as singer Neil Diamond, gospel singer Shirley Caesar and others.
The deal pools the cash generated from such royalties, securitises it and passes it to investors as a way for Sesac to raise money outside of a bank loan or going to the traditional bond market.
The bond was originally expected to price earlier this month but has now been delayed until September, after Goldman’s team pulled their original offering from the market, people familiar with the matter said. – Copyright The Financial Times Limited 2012
