DIGGING DEEP INTO AMERICA

Friday, April 1, 2011

Live Nation Makes A Bid For Warner








LOS ANGELES -- Live Nation has reportedly thrown their hat into the recorded music ring with a bid for Warner Music Group. If the bid is successful, the acquisition would give Live Nation control over the third largest label group.
According to the WSJ, Goldman Sachs and AGM Partners LLC, who are handling the Warner auction, say they have received bids for both Warner in its entirety and broken-out bids for Warner's label operations and their music publishing operations separately.
Sources close to matter told the WSJ that Live Nation is primarily interested in Warner's recorded music business and not in their music publishing operation.
While it is unclear how committed Live Nation is to acquiring Warner, they are up against some stiff competition. Other bidders include Sony, Guggenheim Partners LLC, and a partnership between KKR & BMG as well as billionaires such as Len Blavatnik, a former Warner exec and Ron Burkle.
Additionally, if Live Nation's bid proved successful, they would likely face regulatory scrutiny over the merger.
The bid marks a public turnaround for the promoter-giant as it was just last February when Live Nation chairman Irving Azoff stated that the company wasn't interested in Warner or rival label group EMI, which is expected to come up for auction by Citigroup later this year.
Live Nation may be looking at the recorded music business as a way to bolster their bottom line and diversify their portfolio. According to the WSJ, Warner generally produces about $300 million in revenue, but posts overall losses due to debt related to their 2004 acquisition by Time-Warner.
Warner is currently owned by a consortium of private equity investors, including Thomas H. Lee Partners. - CelebrityAccess Staff Writers

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