From Film Libraries to Franchise Rights: Intangible Asset-Backed Lending in Media and Entertainment

Media and entertainment has a longer history of intangible asset-backed lending than almost any other sector. Since the earliest days of Hollywood, studios have financed productions against the future revenue streams of the films themselves — the copyright, the distribution rights, the merchandising potential.

But while the sector has been an early adopter, it has also been a narrow one. Most media IP-backed lending remains focused on production financing — funding the creation of new content against pre-sales and projected distribution revenue. The far larger opportunity lies in the accumulated content libraries, music catalogues, franchise intellectual property, and format rights that media companies have built over decades.

For PE firms that have been active in media consolidation, this represents an untapped reservoir of collateral value sitting within portfolio companies.

The Evolving Media Intangible Asset Base

The media landscape has been transformed over the past decade by streaming, globalisation, and the growing economic power of franchise properties. Each of these trends has made the intangible asset base of media companies more valuable — and more suitable as collateral.

Content libraries. A media company's back catalogue of films, television series, and other content is a durable income-producing asset. Unlike a single production, a diversified library generates revenue across multiple windows — theatrical, broadcast, streaming, physical media, and ancillary — with a longevity that extends decades. The catalogue acquisitions by streaming platforms have demonstrated the market's willingness to pay substantial sums for established content libraries, providing transactional evidence for valuation.

Music catalogues and publishing rights. The music industry has seen a wave of catalogue transactions — the Hipgnosis fund, private equity acquisitions of publishing catalogues, and artist catalogue sales — that have established deep valuation benchmarks. Music royalty streams are predictable, diversified across geographies and platforms, and exhibit longevity characteristics that make them excellent collateral. The underlying assets — the musical compositions and master recordings — are perpetual copyrights in many jurisdictions.

Franchise and format IP. The most valuable media properties are now franchises — interconnected universes of characters, stories, and settings that generate revenue across film, television, publishing, gaming, merchandise, and live experiences. The IP that defines a franchise — character rights, story bibles, visual design assets, trademark portfolios — is distinct from any individual production and can be identified, valued, and pledged as collateral separately.

Streaming and distribution agreements. Long-term output deals, platform licensing agreements, and territorial distribution contracts create predictable revenue streams backed by contractual obligations from creditworthy counterparties. These are essentially receivables secured against intangible content rights, and they are eminently securitisable.

Financing Structures for Media IP

Drawing on the principles I learned structuring asset-backed transactions at Rothschild, the key to media intangible lending is segregating the asset from operating company risk and creating clean cash flow waterfalls.

Media IP Lending Structures at a Glance

Library-backed revolving facilities. A content library is transferred to (or held by) an SPV that grants the operating company an exclusive licence to exploit the content. The SPV pledges the library as security for a revolving credit facility. As new content is added to the library, the collateral base grows and the facility can be upsized. Revenue from the library flows through the SPV, servicing the debt before distributing to the operating company. This is a flexible, scalable structure that mirrors the revolving nature of media content creation and exploitation.

Catalogue securitisation. For music catalogues or substantial content libraries, a rated securitisation structure pools the royalty and licensing income from the catalogue, issues tranched debt against it, and provides investors with diversified exposure to media content revenue. The underlying copyright assets have perpetual or very long-dated legal life, which supports long-dated debt structures that reduce refinancing risk.

Franchise IP holdco lending. The core IP of a franchise — character rights, trademarks, design assets — is held in a dedicated holding company separate from any individual production entity. This holdco can raise debt against the franchise IP, with the income derived from licensing the IP to production entities, merchandise licensees, and gaming developers servicing the debt. The structure protects the franchise IP from production-level risk and gives lenders security over the most durable and valuable layer of the media value chain.

Production slate financing with enhanced IP security. Traditional production slate financing can be enhanced by taking additional security over the IP assets created by the slate — not just the revenue from initial distribution, but the long-tail library value and any sequel, prequel, or spin-off rights. This transforms what is typically a short-term cash flow-backed facility into a medium-term asset-backed structure with better risk characteristics.

The PE Perspective on Media Intangible Collateral

Private equity has been highly active in media and entertainment, with transactions spanning film and television studios, music catalogues, podcasting platforms, and live entertainment businesses. The sector's consolidation dynamics create natural opportunities for intangible asset-backed financing.

Acquisition finance efficiency. When a PE firm acquires a media business, the most valuable assets — the content library, the music catalogue, the franchise IP — are intangible. Structuring acquisition debt against these specific assets, rather than against the enterprise or its modest tangible asset base, increases leverage capacity and reduces the cost of debt. A lender with security over a proven content library has a clearer and more valuable enforcement asset than one with a general lien on the operating company.

Platform for consolidation. Buy-and-build strategies in media benefit from intangible collateral structures because each acquisition adds identifiable assets to the collateral pool. A PE-backed media platform that acquires three content libraries can consolidate them into a single SPV structure, achieving diversification benefits that support higher advance rates and better terms.

Value crystallisation at exit. At exit, a media business that has structured and valued its intangible asset base presents a more investable proposition. Buyers can see exactly what IP they are acquiring, how it has been valued, and how it can be financed. This transparency reduces due diligence friction and can accelerate the exit process.

Valuation in a Streaming World

The shift from ownership to streaming has complicated media asset valuation but has not diminished asset value. If anything, the globalisation of streaming platforms has expanded the addressable market for quality content, increasing the potential revenue from library assets.

The challenge is attribution: when a film or series generates value as part of a streaming platform's offering, how is that value allocated to the individual content asset? This is a solvable analytical problem, and the industry is developing methodologies — based on viewership data, subscriber acquisition attribution, and comparable transaction benchmarks — that support credible valuations.

At Opagio, we work with media businesses and their PE sponsors to identify, structure, and value the intangible assets that define value in this sector. The opportunity now is to extend that tradition across the full intangible asset base and to bring the rigour of institutional structured finance to what has often been a bespoke, relationship-driven market.

Tony Hillier is co-founder of Opagio. He holds an MA from Balliol College, Oxford and an MBA with distinction. Tony held executive board positions at NM Rothschild & Sons and GEC Finance, and a non-executive directorship at Financial Security Assurance in New York, where he specialised in structured finance, asset-backed securities, and cross-border tax-leveraged leasing.