The worth of the company’s catalog was cut by 26% last week, confirming many investors’ suspicions that previous valuations had overshot the mark.
The fee is meant to reduce risk for bidders with "bona fide" offers.
The owner of rights to songs by Neil Young, Shakira, Journey and more will hold an extraordinary general meeting to address shareholders' concerns.
To counteract a call option given to the investment advisor, the board proposed paying prospective buyers a fee of up to 20 million pounds to make bidding for its music assets more appealing.
In the final week of 2023, the 20-stock music index gained 1.1% to 1,534.07.
The board cautioned investors to use the company's valuation metrics "with a higher degree of caution and less certainty" than normal.
KPMG will take over the role from Pricewaterhousecoopers, subject to approval by the fund's shareholders.
After receiving a "heavily caveated" opinion from its adviser, Hipgnosis Songs Fund said it needs more time preparing its latest interim results.
The London-listed fund said the $23.1 million sale would be used to pay down debt.
The troubled music rights company also said Spotify and UMG veteran Francis Keeling is joining the board.