Live Nation has reached a new agreement to acquire Mexican concert promoter OCESA Entretenimiento for about US$450 million, reported The Wall Street Journal.
The deal, if completed, would give the world’s largest live-entertainment company a 51% stake and controlling interest in one of its largest competitors, which dominates the Latin American market that has exploded in the streaming era, according to Live Nation. Plans for a deal were previously reached in July 2019, but unraveled when the COVID-19 pandemic devastated live touring.
The deal is now expected to close by late 2021 or early 2022, the company stated. It is subject to regulatory approval, which was previously granted during prior negotiations but must be confirmed. The new agreement is a sign the companies are sure that business is getting back on track.
“We’re confident,” said Live Nation finance chief Joe Berchtold. “The timing wasn’t right when Covid hit to close it,” he said. “They’re the mini Live Nation of Mexico and the beachhead to Latin America.”
Live Nation plans to acquire Spanish-speaking multimedia giant Grupo Televisa’s 40% stake in OCESA, plus another 11% of the company from another Latin American live-entertainment company, CIE, which will hold the remaining 49%, the company says. While the terms of the new agreement are mostly the same, Live Nation is expected to hold back 7% of the closing price to cover any potential operating losses for several quarters. The deal price is 8.84 billion Mexican pesos, equivalent to US$444 million at Friday’s close. The agreement is expected to be announced Monday.