The Stage

Exclusive: Live Nation’s theatre empire up for sale

Published Wednesday 24 June 2009 at 11:05 by Alistair Smith

Live Nation, the UK’s largest theatre operator, has put its entire stock of British theatrical venues up for sale, in a move which could see the biggest overhaul in UK theatre ownership in a decade.

The global live entertainment group, which sold its US theatres in a $90 million deal in 2007, is accepting bids for a package of 17 UK venues. This includes two of the West End’s largest and most profitable sites - the Apollo Victoria and Lyceum theatres, which are currently home to long-running musicals Wicked and The Lion King respectively - as well as a 33% stake in another major London musical house, the Dominion.

A total of more than 30,000 theatre seats across venues in London, Manchester, Liverpool and Edinburgh, among others, are on offer.

The potential sale, which has been long anticipated by the UK market, forms part of an ongoing strategy by the company to focus on its live music operation, selling off non-core assets such as its theatre venues to help fund expansion in this area.

However, the UK theatres represent a profitable operation for Live Nation and it is understood there is a strong possibility that no sale will be finalised, with sources describing the process as a “fishing exercise”.

Investment bank Goldman Sachs, which oversaw the US sale, is also handling the UK bidding.

The process is at a very early stage and currently features more than 20 interested parties, from international theatre operators to private equity firms. The number of potential buyers is expected to be whittled down within the next week or so. Theatre operators understood to be in the running include Stage Entertainment, the major European theatre owner that also produces Sister Act and Hairspray, Key Brand Entertainment, which bought Live Nation’s US theatres and is understood to have had a first-look deal on the UK theatres, and Ambassador Theatre Group, the UK’s second largest theatre operator.

Live Nation is currently only accepting bids for the entirety of its UK theatre portfolio, but it has not ruled out selling off the stock piecemeal, if an acceptable price, believed to be in excess of £75 million, cannot be found for the whole package. Its music venues and arenas are not up for sale.

Paul Latham, Live Nation’s chief operating officer for live music, confirmed that bidding had started, but told The Stage: “We might not sell them. It’s not a foregone conclusion that they will be sold. It will only be if somebody makes an offer we can’t refuse that it will be accepted. If we do sell, it will only be if the money is right - it will only be if someone pays a reasonable amount for what is still a going concern.”