By Lisa Kerner
Charlotte, N.C., Feb. 10 - Live Nation, Inc. and Ticketmaster Entertainment, Inc. announced they agreed to combine in a merger of equals to create Live Nation Entertainment.
The tax-free, all-stock merger has a combined enterprise value of approximately $2.5 billion.
Ticketmaster said its shareholders will receive 1.384 shares of Live Nation common stock for each share of Ticketmaster they own, subject to adjustments, under the merger agreement.
Both companies' boards of directors approved the transaction, which is expected to close in the second half of 2009.
The closing is contingent on shareholder approval, consent of Ticketmaster bank lenders and regulatory review and approvals, Ticketmaster said.
Once the merger is complete, Live Nation and Ticketmaster shareholders will each own approximately 50% of the combined company and Live Nation and Ticketmaster each will have seven directors on the 14-member board, the companies said.
Ticketmaster chairman Barry Diller will lead Live Nation Entertainment as chairman of the board while Michael Rapino, chief executive officer of Live Nation, will become CEO and president of the combined company.
Ticketmaster CEO Irving Azoff will be executive chairman of Live Nation Entertainment and CEO of Front Line.
A location for the combined company's headquarters has yet to be determined.
According to Rapino, Live Nation Entertainment plans to simplify the ticketing process for fans and increase attendance at live events.
Live Nation Entertainment is expected to generate approximately $40 million of operating synergies through the combination of ticketing, marketing, data centers and back-office functions, the companies said.
"No different from any other industry, the challenges are all around every aspect of live entertainment. Being able to put Live Nation and Ticketmaster into an equal partnership will allow the companies to get through this difficult period and be able to expand live entertainment options to audiences throughout the world," Diller said in a joint news release.
Goldman, Sachs & Co. advised Live Nation, and Deutsche Bank provided a fairness opinion to the Live Nation board. Ticketmaster was advised by JPMorgan Chase, and Allen & Co. provided a fairness opinion to the company's board.
Live Nation is a Beverly Hills, Calif., concert promoter, and Ticketmaster is a West Hollywood, Calif.-based ticketing company.
| Acquirer: | Live Nation, Inc.
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| Target: | Ticketmaster Entertainment, Inc.
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| Announcement date: | Feb. 10
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| Transaction total: | $2.5 billion
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| Price per share: | 1.384 Live Nation shares
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| Expected closing: | Second half of 2009
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| Stock price of acquirer: | NYSE: LYV: $45.29 on Feb. 9
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| Stock price of target: | Nasdaq: TKTM: $6.57 on Feb.9
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