First State Media leads acquisition of major music copyright catalogue

First State Media Group has today confirmed the acquisition of a major music copyright catalogue comprising substantially all of the music copyright assets originally assembled by DreamWorks Music Publishing LLC.

The music copyright catalogue will be exclusively managed by First State Media Group and has been acquired by Colonial First State Global Asset Management.

First State Investments (UK) is part of Colonial First State Global Asset Management which formed a joint venture in late 2006 with a management team led by Steve D. McMellon for the purposes of acquiring and managing media assets. Mr McMellon is Managing Director of the First State Media Group joint venture and has 20 years’ of media industry experience, with extensive expertise in sourcing, evaluating, financing and actively managing media copyright assets.

The acquired catalogue consists of more than 25,000 musical works across a wide range of music genres including many iconic works from the 1950s to present day, including “Disco Inferno”, “Somebody to Love”, “Take Me Home, Country Roads”, “Monster Mash” and other classic songs. A number of these musical works have been widely used in film and other media works.

Warwick Negus, CEO of Colonial First State Global Asset Management said, “Music copyright assets are attractive for investors because they generate global income streams in the form of predictable and recurring cash flows. In addition, they hold considerable long-term growth potential through the active promotion and management of the underlying musical works.”

Music copyright assets generate global cash flows from a range of sources, including worldwide royalties paid for the use of specific musical works.

To enhance the income growth of its music copyright assets, First State Media Group has acquired a global platform of established copyright administration companies to undertake the direct collection of royalties. This provides First State Media Group with the specialist capability to directly monitor and administer the worldwide payment of royalties, considerably improving the speed, transparency and accuracy of cash flows to investors. It also provides First State Media Group with a global team of professionals who can enhance the income produced by such assets through “on the ground” and active promotion in many major markets. This team has been re-branded under the name, “State One Music”.

Mr Negus said “We have adapted our proven business model in property and infrastructure to create an integrated and specialist management business. When combined with Steve and his team’s industry expertise, First State Media Group has built specialist capability in the acquisition, financing, value management and global administration of this type of media asset.”

Charlie Metcalfe, CEO of First State Investments said, “First State Media is another great example of our commitment to expanding our expertise in specialist sectors in order to meet the growing demands of our investors for innovative investment solutions. The acquired copyright catalogue is likely to be a foundation asset for a media focused fund that we expect to launch towards the end of 2007.”

Mr Metcalfe concluded “It is this type of long term, cash generative asset that should be increasingly looked at by institutional investors. It is an ideal liability match.”