LOS ANGELES (CelebrityAccess MediaWire) — Live Nation and Gaiety Investments have completed the acquisition of a 56% interest in Academy Music Holdings Limited (AMG) from RJD Partners. AMG is the owner and operator of 12 live music venues in U.K., annually hosting over 2,500 events attracting more than 3 million fans.
AMG owns some of the U.K.’s most successful music venues, such as Carling Academy Brixton and Shepherd’s Bush Empire, and plans to continue its roll-out of music venues across the country. The acquisition of AMG substantially accelerates Live Nation’s U.K. music venue strategy and builds on its already strong partnership with Gaiety, with whom it already owns Mean Fiddler Holdings Ltd.
“AMG has one of the strongest live music venue brands in the UK,” said Live Nation Chief Executive Officer Michael Rapino. “The venues that we are acquiring are among the best in the world. The acquisition of AMG will enable us to grow our UK venue network with a brand that music fans know and love.”
The transaction values AMG at $114.0 million, including the assumption of $56.9 million of bank debt and third-party shareholder loans. For the twelve months ended December 31, 2006, AMG generated $11.6 million of Adjusted EBITDA. AMG is expected to demonstrate strong growth as it rolls out new venues (including two new venue leases AMG has recently signed), younger venues mature and revenue and supply synergies from the combination with Live Nation and Gaiety are realized.
As a condition to the acquisition of AMG, Mean Fiddler Holdings Ltd. and Live Nation have each entered into conditional agreements for the divestment to MAMA Group PLC of the Forum and London’s Hammersmith Apollo venues, respectively. For the year ended 31 December 2006, the Forum and Hammersmith venues generated $3.7 million of Adjusted EBITDA. The expected sale price for the two venues is $26.9 million, net of fees and expenses associated with the transaction.
Initially, Live Nation-Gaiety’s joint venture will hold a 44% interest in AMG and Gaiety will continue to hold its existing 12% stake in AMG. Gaiety expects to later contribute its stake to the Live Nation-Gaiety joint venture. Live Nation holds a 50.1% interest in the joint venture with Gaiety. –by CelebrityAccess Staff Writers