R. Kelly’s Publishing Catalog Is for Sale, But What’s It Worth?

As R. Kelly faces a trial in New York on federal

racketeering and sex trafficking charges, with

another trial for similar charges to follow in Chicago,

the singer’s lawyer says that he’s running out of

money. “His funds are depleted,” said

attorney Deveraux Cannick at an Aug. 3 court

hearing, requesting free trial transcripts for his

client.

In jail since July 2019, Kelly hasn’t been able to tour

or release new music. His existing recordings still

generate plenty of revenue that flows to former label

RCA Records — about $1.7 million in the United

States so far this year, Billboard estimates — but the

resulting royalties don’t go into Kelly’s pockets.

That’s because the money has been claimed by both

his former recording studio landlord and a woman

who won a $4 million judgment against him for

allegedly sexually abusing her when she was 16.

Kelly’s financial problems aren’t new: He has owed

millions of dollars in federal and state taxes for over

a decade. In 2019, two months after the explosive

Surviving R. Kelly put the abuse allegations against

Kelly back in the public eye, Kelly told interviewer

Gayle King that he couldn’t afford to pay the

$161,000 he owed in child support and only had

$350,000 in the bank because business associates

had been cheating him for years.

 

“There are these people — and I don’t even know who

they are — that still have some sort of access or

control of his money and his assets,” says Michael

Leonard, an attorney on Kelly’s forthcoming Chicago

trial. “For 15-20 years, he had no access to the

money. He didn’t even have a cash card. He would

literally have to ask his financial people, ‘Can I have a

couple hundred bucks,’ or, ‘I need a car.’ But he had

no ability to engage in financial transactions, and all

these people around him did. And all these people

around him used all his money and took his money.”

 

In the past few years, both RCA and Universal Music

Publishing Group have dropped Kelly, although both

still own rights to his work, and he scuttled a planned

tour outside the United States. So, in order to raise

money, Kelly has been quietly shopping his

publishing catalog, according to two music asset

buyers who were approached about a possible

purchase. Although the catalog includes over a dozen

top 10 Billboard Hot 100 hits recorded by Kelly, as

well as songs for AaliyahMichael Jackson and

others, a buyer hasn’t been found. A representative

for Kelly declined to comment.

 

“It has been offered to me a number of times by his

team, and of course, I’ve said no for the obvious

reasons,” says Merck Mercuriadis, Hipgnosis Songs

Fund founder and CEO of The Family (Music) Ltd.,

adding that the last discussion took place about six

months ago. Kelly himself sang most of his biggest

hits, and Mercuriadis believes that listeners will have

an even harder time separating the man from his

music if he’s found guilty. “There are incredible

songs in that catalog,” he says, “but why would you

take that kind of risk?”

 

Another music asset buyer who passed on a purchase

two years ago was even more blunt: “We wouldn’t go

near it with a 10-foot pole.”

 

Other asset buyers Billboard spoke with say they

haven’t been approached but could potentially be

interested, although they would try to make a deal

quietly in order to avoid attention.

 

Kelly’s efforts to sell “in an effort to meet some of his

financial obligations” are complicated by the fact he’s

in jail, says Nicole Blank Becker, one of his trial

attorneys who is not involved with the catalog sale

and did not confirm any details. “It’s kind of difficult

to do when you’re in prison and don’t have the ability

to speak to the people that be to assist him with that,”

she said.

 

What could be for sale? Kelly’s songs released before

2007 — including “Bump N’ Grind,” “I Believe I Can

Fly” and “Ignition (Remix)” — appear to be covered

under a publishing deal that Kelly signed with

Zomba, which Universal Music Group acquired in

2006, along with the rest of BMG Music Publishing.

Some of his post-2007 songs appear to be covered

under a co-publishing deal with UMG, which would

give him a bigger split of songs like “Number One”

and “Good Sex.” So Kelly could sell his 50%

songwriter share from earlier compositions and both

the writer’s share and co-publishing rights to the

later material.

 

It’s hard to say what these songs are worth now,

though. R&B song catalogs typically sell for a 12-

times multiple of net publisher’s share of gross

profit, but such a successful sole writer could

potentially get 20-times NPS,

which Billboard estimates to be at least $1.05

million, and implies that Kelly’s songs could have

been worth up to $21 million.

 

The allegations against Kelly would almost certainly

reduce that price significantly. Few movies and

advertisements will presumably want to license

synch rights to his songs. His radio airplay has

diminished 98% since Surviving R. Kelly came out,

and his popularity on on-demand streaming fell

13.5% the year after the documentary (according to

MRC Data), with his streams now growing slower

than streaming overall. Given the accusations and

charges against him, and because he appears to be a

motivated seller, one music asset trader

tells Billboard that Kelly’s catalog would likely only

sell at an eight- to 10-times multiple, or between $8.4

million and $10.5 million. And “if he is guilty,” says a

music publishing executive, “then it is a fire sale.”

What the end result of this calamity will be is

anyone’s guess but it’s safe to say the end may be

near for R. Kelly.

 

Source: Tyshawn Smith

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