A gap between public market valuations and the long-term economics of music rights is slowing catalog acquisitions, according to CJ Johnson, head of entertainment investment banking at Truist Securities. The mismatch makes it harder for buyers and sellers to agree on prices.
Johnson argues that the pressure on publicly traded companies to deliver quarterly earnings does not reflect how catalog assets perform over longer periods. He also says consolidation among major catalog buyers has left fewer active acquirers, changing deal dynamics and pricing expectations.
As conventional catalog transactions become harder to close, Johnson says capital is increasingly moving into areas adjacent to traditional music publishing.
