Hipgnosis Songs Fund (HSF), its investment adviser, and founder Merck Mercuriadis face a lawsuit from liquidators of the defunct Hipgnosis Music Limited (HML), alleging breach of fiduciary duty and diversion of business opportunities.

The lawsuit claims that Mercuriadis, a former director of HML, diverted business opportunities from HML to newer Hipgnosis entities. HSF is accused of unlawfully assisting or receiving this alleged diversion. When HML wound up in 2018, it owed creditors approximately $4.54 million (£3.6 million).

Key points about the lawsuit:

• HSF, Blackstone-powered Hipgnosis Song Management (HSM), and Mercuriadis have all been served
• All parties deny the claims and plan to defend vigorously
• HSF is not insured for costs related to this claim
• HML was co-founded in 2015 by Mercuriadis and Swedish businessman Afram Gergeo
• Gergeo was later imprisoned for involvement in a Maltese pension scheme fraud

HSF is currently undergoing a strategic review, set to conclude by April 26th, 2024. The fund's stock (LON: SONG) recently declined 2.2 percent to 69 pence per share.

Related Articles

Previous Articles