The bonds backed by publishing and recording rights on singer David Bowie’s back catalog have been hit by a ratings downgrade from Moody’s Investors Service.
The issuer of the bonds, Jones/Tintoretto Entertainment Company LLC, was downgraded to Baa3 — just one notch above junk — from A3 by Moody’s on Friday (March 19), after a lengthy review process.
The credit-rating agency cited the weaker sales of recorded music and a downgrade of an unnamed company that guarantees the issue.
A specialist in intellectual property securitizations, who asked not to be named, said that the guarantee came from British music company EMI Group PLC. He said that in March 2003, EMI’s long-term credit rating was lowered by Moody’s.
The $55 million, 10-year Bowie Bonds issue is backed by the rights on 287 songs.
The bonds were touted as the forerunner of a new class of intellectual property securitizations when they were sold in 1997. However, there have been few similar deals since.
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