Company acquires equity stake from Front Line for $116.2 million
Liberty Media CEO Irving Azoff has been named chairman of Live Nation, the entertainment company announced on Monday.
In addition, Live Nation acquired the remaining equity stake in Front Line Management Group from Azoff and Madison Square Garden for $116.2 million in cash and stock.
The blunt-spoken Azoff has made waves in recent months for his Twitter battles with the likes of Perez Hilton and micro-blogged broadsides against online piracy.
Azoff will replace interim chairman John Malone. His appointment could bring stability to a board of directors that has been riled by infighting for much of the past year. Malone was brought on board as a temporary stop-gap after former chairman Barry Diller resigned from the post last fall after feuding with board members Ari Emanuel and Mark Shapiro.
The cash portion of the transaction totaled $56.5 million and was funded with cash on hand. The remaining $59.7 million was paid with newly-issued shares of Live Nation common stock.
Of the total shares issued, Azoff receives 1.8 million shares of common stock and Madison Square Garden received 3.9 million shares of common stock.
"Through this transaction we will further simplify and consolidate our operating structure," Michael Rapino, president and chief executive officer of Live Nation, said in a statement. "By acquiring full ownership of Front Line, we expect to benefit from substantial savings related to cash taxes, the elimination of the dividend and operating synergies resulting in an increase in our free cash flow in excess of $20 million annually. Front Line is a tremendous asset and a key component of our live entertainment and marketing platform. We look forward to Irving's ongoing contributions as we continue to focus on increasing the growth potential of our combined operations."
In addition, Greg Maffei, chief executive officer of Liberty Media Corporation, has joined the board and has been named chairman of the company’s newly-formed Executive Committee.