Madison Square Garden Entertainment Corp. has given final board approval to a spinoff of its traditional live entertainment business, with the transaction expected to be completed April 20.
Once the tax-free separation from the company’s other businesses, which include the MSG Sphere in Las Vegas and the MSG regional sports networks, is finalized, the parent company will be renamed Sphere Entertainment Co.
The rebranded parent will comprise the Sphere, MSG Networks and Tao Group Hospitality business, a restaurant group for which MSG is exploring a possible sale.
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Once spun off, the live entertainment company will assume the name Madison Square Garden Entertainment Corp. and will comprise performance venues, an entertainment and sports bookings business, and the Christmas Spectacular Starring the Radio City Rockettes production.
“With today’s announcement, we are one step closer toward our goal of creating two distinct companies, each well positioned to generate long-term value for our shareholders,” executive chairman and CEO James L. Dolan said in a statement.
As part of the spinoff transaction, common shareholders will receive one Class A or Class B share of the new live entertainment company for every share of the company’s Class A or Class B common stock, respectively.
Once the spinoff is completed, Sphere Entertainment will own around 33 percent of the outstanding shares of the new live entertainment company, which will trade on the New York Stock Exchange.
MSG is also in development on a direct-to-consumer streaming offering, MSG+, which is expected to launch over the summer, and will offer annual, monthly and per game subscriptions.
