LOS ANGELES (CelebrityAccess MediaWire) — Live Nation and Ticketmaster have released a joint proxy statement to shareholders, ahead of their hoped-for merger, providing insight into the details of the plan.
Although no date beyond a nebulous 2009 is specified for the shareholder meeting, the proxy form does shed considerable light on what the post-merger company, Live Nation Entertainment, will look like.
If the merger is approved, the board at the new company will be composed of 14 members, seven directors drawn from Live Nation and seven from Ticketmaster Entertainment, including two from Liberty Media. Live Nation expects to tap current CEO Michael Rapino while Ticketmaster expects to designate current chairman Barry Diller and, unsurprisingly, current CEO Irving Azoff.
The proposed deal, first announced on February 10, has roots in late 2008 when Ticketmaster's newly-reconstituted board, started looking at options for strategic acquisitions or partnerships in the live entertainment sector. In early December, Messrs. Azoff met with Rapino and Live Nation's to discuss a possible deal while Barry Diller held similar meetings with Randall Mays and by December 18th, due diligence on a possible deal had begun and confidentiality agreements had been signed.
This timeline for the deal is intriguing as Live Nation's in-house ticketing system didn't go online until early January, 2009 but shows that Live Nation and Ticketmaster were in negotiations well before that date. The system, launched in a partnership with Live Nation and European ticketing firm CTS Eventim, didn't have a strong debut and the company has been less than forthcoming about the future of their contract with CTS since the merger came to light.
The proxy statement did make one reference to the CTS Eventim deal and stipulated that the agreement may require Live Nation to "take actions, or incur expenses that could limit the ability of Live Nation and TME to fully integrate their businesses successfully." If this is a suggestion that Live Nation would take a financial hit to break their deal with CTS is unclear.
The proxy statement also discusses AEG's threat to discontinue using Ticketmaster for ticketing services and that any agreement between Ticketmaster and Live Nation would open the door to a discontinuation of contracts AEG has with Ticketmaster, a move that would be a blow to Ticketmaster Entertainment's bottom line.
The proxy also covers compensation, including descriptions of a number of Mr. Azoff's family members who are currently on Ticketmaster's payroll. Azoff's son, daughter, and son-in-law all collect a paycheck from Ticketmaster, with daughter Allison netting more than 200,000 a year. Azoff's air transport company ATC also collected fees of nearly $230,000 last year when Azoff used its services for business purposes.
Mr. Rapino's compensation will see him collect 1,500,000 in salary, with the potential for 300,000 in bonuses and an array of stock options while Mr. Azoff will net $2,000,000 in annual salary, plus a $2,000,000 annual bonus along with generous dollops of stock options and other assorted benefits.
Of course, all of this is dependent on the deal clearing the numerous regulatory and legal hurdles that it currently faces. Dealmakers on both sides are still working on closing the merger, with an eye towards completing in November, '09. – CelebrityAccess Staff Writers
