Little that 'we' know that investment and entertainment can co-exist.
I could not recall how many private equity firms, venture capitals, investment funds or banks that already and would continue to put their money in entertainment and media either in Europe or in the States. Must be in thousands like Goldman Sachs, KKR, Carlyle Group, Haim Saban, Ingenious Media, Media Right Capital and Citigroup.
Did you know that Goldman Sachs owns 50% of the 'CSI' franchise? In 2007, Goldman acquired the interest in the shows through its purchase of "CSI" co-producer Alliance Atlantis. Goldman retained the rights to the "CSI" until today.
Before I left London, Citigroup was busy with Terra Firma Capital Partners LP bidding for British's EMI. The music industry is not very kind to their £4 billion investment though. KKR and +Bertelsmann via theirBMG Rights BMG Rights Management was eyeing to get EMI's +Parlophone Records that houses artists like +Coldplay and David Bowie. However, Universal Music Group stepped in to complete the acquisition.
The primary reason to see participation of investment banks or private equity firms in entertainment is similar to any industries. They are looking for a good return for investors. They structure and arrange financing for acquisitions or growth. They also assist in capital raising exercise in venture capital, private equity and debt commitments for investments from start-up phase to the recapitalization.
Investment in entertainment is quite straight forward, once you understand and identify the niche market. Some private equity firms invest in media technology, production houses, distributions, big established studios and last but not least, intellectual property.
Generally, banks financed the medium sized media company in the senior debt bank market i.e. with collateral. The collateral is the intellectual property and they do finance it like a real estate, with minimal amortization and long repayment periods.
Intellectual properties are ideal for long term investment since they have long stable and predictable cash flow. The royalties on the ongoing use of intellectual property, licensing and interests are nevertheless offer a steady return for the investors. What is more, some countries have a near to zero and banks are pretty good in their transfer pricing department. I am not sure whether the Dutch's zero rated royalty income is going to change soon though.
Investment in entertainment is possible. The established markets like in the States and Europe offer considerable opportunities to private equity firms and investors to put their money in entertainment and media industry. I reckon Malaysia's entertainment and media industry is still at the infancy stage since the circulation of capital is almost insignificant.
I could not recall how many private equity firms, venture capitals, investment funds or banks that already and would continue to put their money in entertainment and media either in Europe or in the States. Must be in thousands like Goldman Sachs, KKR, Carlyle Group, Haim Saban, Ingenious Media, Media Right Capital and Citigroup.
Did you know that Goldman Sachs owns 50% of the 'CSI' franchise? In 2007, Goldman acquired the interest in the shows through its purchase of "CSI" co-producer Alliance Atlantis. Goldman retained the rights to the "CSI" until today.
Before I left London, Citigroup was busy with Terra Firma Capital Partners LP bidding for British's EMI. The music industry is not very kind to their £4 billion investment though. KKR and +Bertelsmann via their
The primary reason to see participation of investment banks or private equity firms in entertainment is similar to any industries. They are looking for a good return for investors. They structure and arrange financing for acquisitions or growth. They also assist in capital raising exercise in venture capital, private equity and debt commitments for investments from start-up phase to the recapitalization.
Investment in entertainment is quite straight forward, once you understand and identify the niche market. Some private equity firms invest in media technology, production houses, distributions, big established studios and last but not least, intellectual property.
Generally, banks financed the medium sized media company in the senior debt bank market i.e. with collateral. The collateral is the intellectual property and they do finance it like a real estate, with minimal amortization and long repayment periods.
Intellectual properties are ideal for long term investment since they have long stable and predictable cash flow. The royalties on the ongoing use of intellectual property, licensing and interests are nevertheless offer a steady return for the investors. What is more, some countries have a near to zero and banks are pretty good in their transfer pricing department. I am not sure whether the Dutch's zero rated royalty income is going to change soon though.
Investment in entertainment is possible. The established markets like in the States and Europe offer considerable opportunities to private equity firms and investors to put their money in entertainment and media industry. I reckon Malaysia's entertainment and media industry is still at the infancy stage since the circulation of capital is almost insignificant.
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