Primary Wave agrees deal to acquire Kobalt

Under the agreement, Kobalt will continue to operate as a separate stand-alone business under chief executive Laurent Hubert and the current management team, according to the companies. The transaction covers Kobalt’s global operations, its catalogue of owned copyrights and amra, its digital collection business.

The acquisition marks a significant move in the independent music sector, where companies have increasingly looked to scale through consolidation, technology and catalogue expansion. Earlier reports said Primary Wave had emerged as the remaining bidder in talks with Francisco Partners, which bought a 90% controlling stake in Kobalt in 2022 for about $750 million.

Primary Wave chief executive and founder Larry Mestel said the deal would support Kobalt’s growth and creator services. “Over the many years Laurent and I have known each other I have always been impressed by the remarkable team he has built, as well as the extraordinary growth Kobalt has experienced under his leadership,” he said.

He added: “This acquisition will only enhance his efforts to provide creators individualised attention and specialised support at every stage of their journey and to provide a very significant amount of capital to Kobalt for continued growth.”

Hubert said Kobalt’s strategy and leadership would remain focused on its existing model. “Primary Wave understands our vision of independence and the importance of our ‘creator first’ mindset driven by service, technology, and creativity,” he said. “We are incredibly excited about our next chapter with them as our partner.”

In a letter to clients, Hubert said the company would remain independent in its operations and leadership. “This is not a change in direction, but rather a continuation of our evolution,” he wrote, adding that it had been important to find partners who understood “the independent nature” of Kobalt’s business.

Francisco Partners said the business had expanded its technology and international presence during its ownership period. “Our partnership with Kobalt has been defined by a shared commitment to innovation and the success of the independent creator,” said Mario Razzini, a partner at the firm. He said Primary Wave was “the ideal partner” for Kobalt’s next stage of development.

Kobalt founder Willard Ahdritz is set to step down as chairman when the deal closes. He said he was leaving the business confident in its future direction. “Primary Wave is the right home for Kobalt’s next chapter, and I step down as Chairman feeling confident about the future of the business, its people, and its mission,” he said.

Goldman Sachs & Co. LLC acted as financial adviser on the transaction. Brookfield’s role is notable because it has partnered with Primary Wave since 2022, when the two companies struck a multibillion-dollar funding arrangement to support music rights acquisitions.

Industry reports before the announcement suggested the combined group could hold assets worth more than $7 billion, though neither company disclosed a transaction value on Monday.