Live Nation inks deal with SMG-Savor
Concessions at 34 arenas to be AramarkNASHVILLE -- Live Nation has reached a five-year agreement with SMG-Savor, the food service division of Philadelphia-based venue management firm SMG, and multiservice food concessionaire Aramark to provide food and beverage service at 34 of Live Nation's North American amphitheaters.
Live Nation estimates that in 2007, concession sales in the venues included in the deal generated $100 million in revenue.
Under the terms of the agreement, SMG-Savor/Aramark will manage food and beverage concessions for the more than eight million music fans who attend concerts at the 34 amphitheaters annually.
"This new agreement represents another major step in our strategic plan to capitalize on our industry leadership position to increase our profitability," said Jason Garner, CEO of Global Music for Live Nation. "By uniting two of the world's most respected and successful food and beverage operators, we currently expect to generate an approximately 20% increase in annual adjusted operating income for our North American concessions business, with no execution risk to Live Nation. We believe that this deal further strengthens our growth profile, despite the current economic slowdown."
Aramark was already in many Live Nation sheds through Aramark's previous acquisition of Ogden's entertainment division, though many of those original LN/Ogden contracts are believed to be expired or up imminently.
Aramark previously was the primary stakeholder in SMG before the company was acquired by American Capital Strategies last year, allowing SMG to more aggressively compete in the lucrative concessions business. Live Nation recently announced a deal with SMG to provide ticketing services at SMG-managed buildings as contracts allow.