Sovereign Media Group

BR Review: Sovereign IHT Solution

08 Feb 2022 / Tax enhanced research

Why invest


  • Strategy: To purchase, develop and exploit music publishing rights.


  • Diversification: The company is a year- old, and has a single trading strategy, although it may add media lending in the future.



  • Team: The directors have a strong track record in the film and music industries, and an extensive network of contacts.


  • Track record: Although the team has experience of music publishing, this is a recent strategy for Sovereign.

Nuts & bolts

  • Governance: The company board will have no independent directors.
  • Diversification: To date, the two portfolios have 1,196 copyrights. While these will have a wide range of revenue generation capability, this suggests good diversification in due course.
  • Valuation: There will be a third-party valuer, and trades will take place at audited NAV plus fees.


  • Annual fees: Stated annual fees total 1.25% p.a. plus VAT. With no directors’ fees, additional company costs should be limited. Overall, costs are at the lower end of the sector.
  • Other fees: A 2% entry fee and 1% on exit; no performance fee.


  • Target returns: The target return is 3% p.a. Modelling would suggest that, once invested, the company has a good chance of meeting or exceeding that target. This is unusual within the sector.
  • Investment risk: In common with most products in the non-AIM BR sector, Sovereign targets a lower return than the yield on the underlying assets. The fee and expected cost structure keep this gap reasonable.
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