The guys in The Offspring probably woke up this morning feeling like a million bucks. Actually, multiply that by 35. Yesterday, bleached-blond frontman Dexter Holland and his band sold their catalog to Round Hill Music for an estimated $35 million. Whether we're talking Noodles' blistering guitar licks on "Bad Habit" or the embarrassingly catchy "Cruising California (Bumpin' In My Trunk)," it's clear that the New York-based record label just acquired a pop punk goldmine.
The terms of the deal were not disclosed, however Billboard says Round Hill now owns the rights to the band’s Columbia Records master recording catalog, including six studio albums and one greatest hits album. The band’s best-selling record, 1994’s Smash (which went sextuple platinum and is considered the best selling independent album of all time), remains owned by Epitaph Records. But Round Hill Music has reportedly acquired publishing rights to the songs on Smash and the band’s earlier Epitaph album Ignition.
Obviously, the label wanted this catalog pretty badly for a number of reasons. Sources say the catalog produced $3.1 million in net publisher or net label revenue, also known as gross profit. While some sources say that Round Hill paid a multiple of at least 12 times or higher, the above numbers work out to an 11.3 times multiple.
"We have some masters like the Bush catalog and records from developing artists like London Souls and Nigel Hall, but we wanted more exposure and you won't get a more high-quality catalog than The Offspring," says Round Hill Music chairman/CEO Josh Gruss. "Also, we didn't have some American punk rock in our publishing portfolio, and this acquisitions helps broaden the genre representation."
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Because of streaming, recorded masters produce more predictable revenue income than in years past, similar to publishing. So it makes sense, Gruss says, to buy such assets instead of waiting for streaming to breathe new life into the record business, after which assets such as these will increase in price.
The acquisition is Round Hill’s biggest to date, save for a similar deal for the song catalog of Big Loud Shirt Industries which might also reach the $35 million mark.
Of course the band, who were just blue collar working guys in longtime local band when Smash hit, were more than happy to trade their catalog in for a nice fa nest egg. “We felt that having the right caretaker for our catalogue, both the masters and the publishing, is incredibly important to the future of our career,” Holland says in a recent statement. “Round Hill understands that we are continuing to perform and record and that the visibility of our past is critical to our future.”
Of course Holland leaves out the most important part—if you wanna own a catalog of one of OC's biggest bands, you gotta be willing to come out and pay.