The world's largest concert promoter Live Nation Inc plans to buy Ticketmaster Entertainment Inc for about $400 million in stock in a bid to create a company with dominant holdings in concert promotion and ticket sales.
But shares of both companies fell on Tuesday, amid concerns the acquisition would be blocked by U.S. antitrust regulators under the new Obama administration.
U.S. Senator Charles Schumer slammed the deal ahead of its formal announcement on Tuesday, calling for a federal probe into Ticketmaster, the top U.S. ticket vendor.
"This merger would give a giant, new entity unrivaled power over concert-goers and the prices they pay to see their favorite artists and bands," the Democrat senator from New York said in a statement The combined company will be called Live Nation Entertainment, and sell more than 150 million concert tickets a year, promote 22,000 concerts annually, and own more than 140 venues globally. It will also handle more than 200 big name artists including Madonna, Jay-Z, Miley Cyrus and the Eagles.
Ticketmaster shareholders will receive 1.384 shares of Live Nation common stock for each share of Ticketmaster they own, the two companies said in a joint statement. Live Nation will own 49.99 percent of the combined company, while Ticketmaster will hold the remaining 50.01 percent.
The deal, which the companies called a merger of equals, will create a company with an enterprise value of $2.5 billion including debt.
Live Nation CEO Michael Rapino will run the new company as CEO while Ticketmaster Entertainment CEO Irving Azoff will be executive chairman. Ticketmaster chairman Barry Diller will be non-executive chairman. [REUTERS]