Vivid Seats Is Going Public, Testing Investor Confidence in Concerts
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Bulletin YOUR DAILY ENTERTAINMENT NEWS UPDATE APRIL 27, 2021 Page 1 of 22 INSIDE Vivid Seats Is Going Public, • Blackstone Is Testing Investor Confidence Buying eOne Music, Including Death Row in Concerts’ Comeback Catalog, for $385M BY GLENN PEOPLES • Spotify Launches Podcast Subscription Plans With the U.S. concert season returning to pent-up SPAC investors who do not favor an acquisition. In ad- demand for live events, Vivid Seats, one of the leading dition, institutional investors will commit to a private • Spotify Begins secondary ticket marketplaces, has entered into a de- placement of $225 million in common shares. Raising Prices With finitive merger agreement with Horizon Acquisition Vivid Seats will use the acquisition proceeds to pay Family Plans in US, UK Corporation, a special purpose acquisition company down debt by $677 million, leaving $108 million of (SPAC) controlled by Todd Boehly and his Eldridge debt (net of cash) on its books, according to a Horizon • Warner Music Industries investment firm. investor presentation. The company said in a press Group Launches New Horizon raised $544 million in an August 2020 release it will invest in “growth and improvement Ad Sales & Creative Content Division initial public offering on the strength of Boehly’s name customer experiences.” and experience in media and entertainment companies. While some SPAC acquisitions involve developing • PRS for Music Boehly is chairman of MRC, which has an investment technologies such as batteries or nascent industries Warns of Hard Times in Penske Media, Billboard’s parent company, and like legal marijuana, Vivid Seats has healthy mar- Ahead as Revenues Drop 20% counts Los Angeles Dodgers, Draft Kings, The Beverly gins, a history of profitability, and the likelihood it Hilton and Flexjet among his investments. He will join will capitalize on an economic rebound and reboot • Legendary the Vivid Seats board of directors once the deal closes; of the concerts business. But Horizon entered the Recording Engineer Vivid Seats will retain its management team, including picture while the pandemic effectively put the live Al Schmitt Dead at 91 CEO Stan Chia and CFO Lawrence Fey. events business on hold and dropped Vivid Seats gross • Burning Man Vivid Seats will receive roughly $769 million in the order value — the value of all tickets sold, not just the Cancels 2021 Event deal and be valued at approximately $2.06 billion. fees Vivid Seats earned — by 94% in $2.28 billion to Eldrige, which provided $155 million of initial fund- $347 million in 2020 compared to 2019. In turn, net ing, will also invest in any common stock redeemed revenue fell by 75.6% from $471 million to $115 million by Horizon shareholders, a right typically granted to (continued) TOTAL IMMERSION ESSENTIAL ANALYSIS of the latest business topics and trends formulated to give industry players the competitive advantage in a rapidly changing market. 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AND THE ARCHIVE Page 3 of 22 IN BRIEF and adjusted EBITDA (earnings before in- in funding; and 90 SPACs liquidated — they IPO on the Nasdaq exchange, is likely to terest, taxes, depreciation and amortization) did not close a deal within the time limit, acquire a company in the media, entertain- dropped from $128 million to $5 million. usually 24 months — and returned investors’ ment, communications, telecommunications Vivid Seats weathered the storm by making money. or technology sector — Liberty head John necessary cutbacks, reducing general and Vivid Seats expects that ticket sales will Malone’s sweet spot — although it has not administrative costs by 50% from June quickly return to normal by the end of 2021. yet had “any substantive discussions” with through December and maintaining a posi- According to company estimates, 15 to 20 potential targets, according to the LMAC tive EBITDA. The company’s value took a artists plan to tour in 2021 that will sell over website. hit, however, and Vivid Seats took a $578.5 500,000 tickets to Live Nation events in impairment expense in 2020. 2021, and about 45 of these artists will hit A SPAC is an empty company, often called the road in 2022. (From 2017 to 2019, on av- Blackstone Is a blank check company, that raises money erage, there were 25 of these top-tier artist through an IPO on a public stock exchange tours, according to the presentation.) With Buying eOne with the express purpose of acquiring a vaccinations on the rise in the U.S., tours private company. Companies increasingly are being booked again and thus far ticket Music, Including favor the SPAC process because it avoids the on-sales have impressed: Bad Bunny set a public scrutiny and expenses related to a blistering pace by selling 480,000 tickets to Death Row traditional IPO. SPACs reached a fever pitch his El Último Tour del Mundo 2022 in less earlier this month when Singapore app Grab than one week in early April — the fastest- Catalog, for announced it will list on the Nasdaq stock selling tour since 2018. exchange through a SPAC at a $40 billion Music has received little interest from $385M valuation. Everyone from A-list investors SPACs that tend to focus on high-growth such as Pershing Square, which raised $4 technology companies. To date, only Music BY ED CHRISTMAN billion in July 2020, to celebrity athletes Acquisition Corporation, a SPAC co-found- such as former baseball player Alex Rodri- ed by former Geffen Records president Neil inancial firm Blackstone has signed guez have been involved with SPACs in the Jacobson that raised $230 million in Febru- a definitive agreement to buy eOne last year. ary, is specifically focused on acquiring a Music from Hasbro for $385 mil- Out of 944 SPACs tracked by SPAC Ana- music company. lion, the companies announced lytics, a database of SPAC activity and IPOs, Another potential music investor is FMonday (April 26). 427 SPACs that have raised a total of $138.7 Liberty Media Acquisition Corporation, According to a press release from Hasbro, billion are seeking acquisition; 254 SPAC the SPAC founded by Liberty Media, the its entire music operation, including its mu- IPOs that raised $63.6 billion are waiting to majority owner of SiriusXM Radio and sic operation in Canada, will be acquired by be completed; 130 acquisitions have been minority investor in Live Nation. LAMC, Blackstone controlled entities. Blackstone announced from SPACs with $31.7 billion which raised $575 million in a January 2021 has nearly $650 billion in assets under man- AUTHORITATIVE INTELLIGENCE. DELIVERED DIGITALLY. CLICK HERE FOR FREE DELIVERY DIGITAL NEWSLETTERS GENE SMITH ...An Ad Man... Billboard mourns the loss of our colleague. He will be missed and remembered by the entire industry for his dedication, passion and love of the business and our brand. BB House_Gene Smith Memorial_06_042421.indd 1 4/19/21 12:24 PM BILLBOARD COUNTRY UPDATE APRIL 13, 2020 | PAGE Page 4 5OF of 1922 ON THE CHARTS JIM ASKER [email protected] IN BRIEF SamHunt’s Southside Rules Top Country agementAlbu throughms; a variety Brett of investment Y oungBillboard ‘Catc broke the newsh’-es that Hasbro Fifth legal Airplay counsel to Entertainment One Canada vehicles, including SESAC music opera- was shopping the company last month. Limited. tions whichLea includesder; the Harry TravisFox Agency. SourcesDenning told Billboard at Makes the time that History eOne Music will be a separate stand-alone Hasbro was seeking $600 million for its operation, according to the announcement, music operation and subsequently said that Spotify Launches Samhelmed Hunt by’s its second current studio global full-length, president andChris first in overHasbro five years,would Southside only accept sales minimum (up 21%) in bids the trackingof week. On Country Airplay, it hops 18-15 (11.9 mil- (MCATaylor Nashville/Universal, “who will focus Music on building Group Nashville), a debuts$200 at No. million 1 on Billboard for either’s eOnelion audience Music orimpressions, Audio Podcastup 16%). Topcreator-first Country Albums music chart brand dated with April global 18. Inscale its first Limited,week (ending or atApril least 9), it$400 million for both. earned 46,000 equivalent album units, including 16,000 in album sales, ac- TRY TO ‘CATCH’ UP WITH YOUNG Brett Youngachieves his fifth consecutive cordingand expertise.” to Nielsen Music/MRC Data. That means that if Entertainmentand total Country One Airplay No.Subscription 1 as “Catch” (Big Machine Label Group)Plans ascends Southside“I’m excited marks to continueHunt’s second to lead No. and 1 on grow the properly priced Audio Limited valuation 2-1, increasing 13% to 36.6 million impressions. chartthis exceptional and fourth top business,” 10. It follows Taylor freshman said in LP a when it acquired that company, then the re- BY BILLBOARDYoung’s first of STAFFsix chart entries, “Sleep With- Montevallostatement., which“We want arrived the at creative the summit commu in No-- corded masters, and its other small business out You,” reached No. 2 in December 2016. 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