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Exclusive: ATG and Key Brand go head to head for Live Nation theatres

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The bidding war for Live Nation’s UK theatre empire has been narrowed down to two final contenders, with Ambassador Theatre Group and John Gore’s Key Brand Entertainment emerging as the front runners to buy Britain’s biggest theatre operator.

The Stage can reveal that the pair are currently the only remaining active purchasers left in the sale process, overseen by investment bank Goldman Sachs.

Stage Entertainment, which had been regarded by many as an early favourite to land the portfolio of 17 UK venues, is understood to have exited the talks in late August. Qdos Entertainment, another interested party, has also removed itself from the sale, while a proposed management buy-out was one of the first bids to fall.

This has left Ambassador Theatre Group, the UK’s second largest theatre operator, and Key Brand Entertainment, the US company which bought Live Nation’s US theatrical venues in early 2008 for $90 million, as the only remaining bidders.

It would be unlikely, but not impossible, for other parties to re-enter the frame.

While the process was initially described as a “fishing exercise”, with Live Nation insisting that it would only sell the venues if it received a suitable price for them, it is now looking increasingly likely that a sale will take place. The Stage understands that both of the offers which have been tabled by ATG and Key Brand are of an acceptable level to Live Nation and it is now simply a question of which bidder can get the money in place for the purchase.

The sums being discussed are believed to be somewhere in the region of £90 million.

The Stage revealed in June that the US-based entertainment company Live Nation, which also operates music venues across the world, has ‘360-degree’ deals with pop stars such as Madonna and U2, and is looking to merge with Ticketmaster, had put its UK portfolio of theatres up for sale. This does not include its UK music venues, but it is now understood that its stake in pantomime company First Family Entertainment, co-owned with ATG, is also part of the deal.

The first hurdle in the bidding process closed in late August, when there were four bidders still interested in the portfolio.

This was whittled down to the final two potential buyers earlier this month and both parties continue to be asked to meet certain financial requirements by Goldman Sachs on a regular basis. It is currently unclear how long this process will take.

If either party is successful in its bid, it would become the largest theatre operator in the UK – in ATG’s case by a very significant margin, as it would then operate more than 40 theatres across the country and hold more venues and seats than any other operator in both the West End and the regions.

It is understood that interested parties have signed non-disclosure agreements relating to the deal.

Live Nation declined to comment.

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