The combined entity, which will be called Live Nation Entertainment, joins Live Nation's concert promotions expertise with Ticketmaster's ticketing service and artist-management arm "to improve the live entertainment experience and drive major innovations in ticketing technology, marketing and service."
Ticketmaster is the ticket service of many national touring houses, as well as Nederlander theatres on Broadway. The merger announcement focused on how pop-concert ticket buyers might benefit from the marriage, as arena events are the meat and potatoes of Live Nation and Ticketmaster.
The companies "will be combined in a tax-free, all-stock merger of equals with a combined enterprise value of approximately $2.5 billion." Under the agreement, Ticketmaster shareholders will receive 1.384 shares of Live Nation common stock for each share of Ticketmaster they own, subject to certain adjustments. Live Nation and Ticketmaster shareholders will each own approximately 50 percent of the combined company.
The new company "anticipates generating approximately $40 million of operating synergies through the combination of their ticketing, marketing, data centers and back-office functions."
The merger agreement was approved by both companies' boards of directors. Barry Diller, chairman of Ticketmaster Entertainment, said, "It was less than two months ago that Ticketmaster ended its 10-year partnership with Live Nation, and I'm extremely glad we could reunite with this combination. 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."
Michael Rapino, CEO of Live Nation, said, "This combination will drive measurable benefits to consumers and accelerate the execution of our strategy to build a better artist-to-fan direct distribution platform. As every industry observer knows, too many tickets go unsold and too many fans are frustrated with their ticket-buying experiences. The current inefficiencies in the system result in higher costs and confusion over access to seats. Together, we will work to simplify the ticketing process and ultimately increase attendance at live events. This is also a logical step in the evolution of our business model, creating a more diversified company with a stronger financial profile that will drive improved shareholder value over the long term."
Irving Azoff, CEO of Ticketmaster Entertainment, said, "This merger, and the resources of these combined companies, will create a new dynamic and unique creative platform of choice for fans across all levels of the live entertainment experience."