The Weeknd is pursuing a $1 billion financing package backed by his music catalog that would deliver $250 million in cash and $750 million in debt. Chord Music Partners currently owns 50% of his publishing; Abel Tesfaye plans to cash out $250 million in equity from the remaining catalog while raising $500 million in senior debt and $250 million in junior debt, with Lyric Capital Group leading investor discussions. The structure implies plans to fund business ventures. The scale of debt, higher expected interest rates, and the equity payout create substantial financial risk that could result in major success or insolvency. An album titled Hurry Up Tomorrow was released in January.
An investor group called Chord Music Partners currently owns 50% of his publishing. The once-and-future Abel Tesfaye (he said he plans to retire the name The Weeknd) now wants to cash out $250 million in equity from what's left of his catalog, plus raising $500 million in senior debt (lower interest, must be paid back first) and $250 million in junior debt (higher interest, must be paid back second). Lyric Capital Group is leading the discussions to find investors for the $1 billion.
Granted, the deal might not go through. Usually investor groups like to announce the sale once it's closed, instead of advertising the action to potential investors by giving interviews to Bloomberg. But if it does happen, there's really only two ways this ends: The Weeknd joins the ranks of billionaire business owners like Rihanna and JAY-Z, or he files for bankruptcy.
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