Homburger advised MusicBird AG in connection with certain financing aspects
Founded in 2020, MusicBird AG aims to build a worldwide portfolio of music rights. MusicBird AG shall become the go-to partner for record labels, composers and musicians. MusicBird AG aims to innovate the monetization of music rights by using big date analytics.
On January 27, 2023, MusicBird AG entered into a credit agreement for an asset-based credit facility with MUFG Bank Ltd. as administrative agent, joint lead arranger, sole bookrunner and f/x provider, to finance the further growth of its business. Homburger advised MusicBird AG on all Swiss law aspects in connection with its financing agreement with MUFG.
The credit is based on the projected cash follow to be generated by three specific music catalogues. In order to ensure that the music catalogues and royalties generated thereunder are ring fenced, these assets were transferred to a newly incorporated Swiss subsidiary of MusicBird AG named MusicBird Rights AG. Under the credit agreement, MusicBird Rights AG was required to create a security interest in the music catalogues. The creation of this novel security interest was challenging not least because the music catalogues are governed by the laws of different jurisdictions. In addition, MusicBird AG was required to coordinate the new credit agreement with its existing Swiss financing arrangement with its shareholders.
The Homburger team was led by Daniel Haeberli (Financing) and included Fabrice Eckert (Financing) and Stefan Oesterhelt (Tax).