Irving Azoff, Madison Square Garden Launch Co-Venture
The Madison Square Garden Company and music industry heavyweight Irving Azoff are partnering on a new company that will offer artist management, music publishing, television production and live event branding and more.
The new company is called Azoff MSG Entertainment, and as part of the deal to establish it, Azoff will be contributing his Azoff Music Management in return for $125 million and a 50 percent stake in the company. MSG also will be providing up to $50 million of revolving credit loans.
Azoff will be the new company's chairman and chief executive. He also will provide consultancy and advisory services to MSG in connection with the management of its live event venues.
The partnership continues a long-lasting friendship and business relationship between Azoff and James Dolan, chairman of MSG.
In 2008, MSG bought a minority stake in Front Line. which at the time was led by Azoff and partially held by Ticketmaster parent IAC. After Ticketmaster was spun off, it was merged with Live Nation, with Azoff assuming the role of chairman and Dolan joining Live Nation Entertainment's board.
On New Year's Eve, Azoff suddenly quit Live Nation, saying he wished to devote his time to running his management company. At the time, he also said, "It’s no secret that a public company isn't my first choice of what to do."
Following that move, Dolan also resigned from Live Nation's board, an action that was seen as being connected to Azoff's departure. Azoff also manages Dolan’s band, J.D. & the Straight Shots.
Now the two are teaming up again in what is being called a "new-model music, media and entertainment company, at the forefront of the emerging revenue streams and groundbreaking technologies of the fast-changing 21st century."
"This is a partnership," Dolan tells The Hollywood Reporter. "It is not subject to the rules of a public company. It will be operated and directed by Mr. Azoff. He has no board. All he has got is me."
"And I'm thrilled to have you, J.D.," responds Azoff.
Azoff says that while he doesn't know what the next big thing is in entertainment, he believes that it's important to be "nimble and quick and flexible" in responding to changing market conditions. That said, the new company is being set up with four key competencies.
Most crucially, Azoff will bring his management services for such clients as the Eagles, Van Halen, Christina Aguilera and Steely Dan.
Azoff MSG Entertainment also will own a 90 percent interest in a music publishing venture run by Randy Grimmett and Sean O'Malley. Azoff says that bringing over folks from ASCAP to operate this unit will become important with the emergence of performing-rights revenue streams from nascent digital services. "Rights-holders do not have a place that can represent them in these needs," he says.
The new company also will have a third division devoted to television production and live event branding. It will be headed by Lawrence Randall, former head of programming and entertainment for the National Football League, and will acquire, develop, produce and exploit live and televised event entertainment.
Azoff shrugs off speculation that it will be competing with Live Nation, saying that although there could be some overlap with his former company's sponsorship division, the new branding unit will be "complementary." He says he can even see Azoff MSG Entertainment working with Live Nation in some instances.
The fourth division of Azoff MSG Entertainment will be a 50 percent interest in a business called Digital Brand Architects, which manages more than 70 bloggers, connects them with brands, and provides consultancy services to brands looking to exploit opportunities in the social media network space. The unit will be overseen by Azoff's daughter, Allison Statter.
In announcing Azoff MSG Entertainment, the company is also touting partnerships with digital technology company ACTV8 as well as United Talent Agency on a rollout of Streets of the City, an interactive live music discovery TV show.
"Irving is a key part of this," says Dolan. "I can't say we would have done this with anybody else."
Adds Dolan, "I expect that three years from now, when talking about the music business, this will be one of the companies that must be mentioned."