Hipgnosis is facing the ire of investors after a chaotic year—and maybe a kind of palace coup.
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00:00 Justin Bieber and Beyonce's music catalogs were bought by a company that's on the verge
00:03 of being shut down.
00:05 Hypnosis shook up the music industry when it first launched with an ambitious plan to
00:08 buy famous artists' back catalogs and sell the royalty rights to investors.
00:12 But the company is now worth 40% less than at its peak two years ago, and shareholders
00:16 just rejected its request for a new five-year mandate and proposed sale of 29 music catalogs,
00:22 including songs from Shakira and Barry Manilow.
00:24 Now Hypnosis has six months to reorganize or face being shut down.
00:27 The company is expected to garner $9.9 million in royalties from its catalog between 2018
00:33 and 2022.
00:34 That's down from an anticipated $21.7 million.
00:37 The group makes most of its money from streaming, and its music catalog is valued at around
00:41 $2.1 billion.
00:42 However, its market value is now just $1.1 billion.