The Cheques Are In The Post

Having got the nod from the Office Of Fair Trading (OFT), Hamsard 2786 – the joint-venture company formed by Clear Channel and Denis Desmond’s Gaiety Investments Limited – has completed its takeover of London’s Mean Fiddler Music Group.

By green-lighting the deal, the OFT decided that the resulting merged company would not result in “a substantial lessening of competition” in the concerts market.

As of July 5th, the Mean Fiddler shareholders that were first to accept Hamsard’s offer (including Harry Lambert, Ashwell Holdings Limited and Scanfrost Limited) will have had a fat cheque drop through their letterboxes or a handsome sum credited to their bank accounts. Former Fiddler chairman Vince Power is now at least £12 million (US$21.1 million) better off and the music industry is already wondering exactly what he’ll do with it.

Other shareholders who accepted later, or choose to accept by the end of July, will not have to wait more than a week to get their payments. CCE U.K.’s chief ops officer Alan Ridgeway, who handled the £37.9 million (US$71.6 million) deal from Hamsard’s side, tells Pollstar the company already has around 99 percent of the shares and expects “the stragglers” to sell before he needs to exercise the right to get the rest by compulsory purchases.

MFMG is expected to be de-listed by the stock exchange and return to being a private company, albeit one that (at the moment) is co-owned by a public company.

Along with Power, non-exec directors Lambert and Eric Hood have quit the Mean Fiddler board, with former managing director Melvin Benn and finance director Jon Hale – along with Desmond – being the only members of the old guard to stay on.

In Desmond’s case, maybe “old guard” isn’t the right expression. Ever since last autumn’s aborted effort to sell the company to city institutions – a move that seemed to be hatched behind his back – Desmond has worked with CCE President/CEO Michael Rapino, Ridgeway and Shane Reihill (founder and chairman of Trinity Venture Capital) to come up with a package that the cash-strapped Fiddler would accept.

Desmond – who made a £3.4 million (US$6.4 million) profit on the £5.8 million worth of MFMG shares he bought a little more than 15 months ago (a 24.3 percent holding) – wouldn’t be drawn on the background to the deal.

“It’s early days,” he told Pollstar. “At the moment, I’m spending a couple of days a week over there and everything is going well. I’m looking forward to getting on with it.”

Desmond has now moved up to managing director, with the new board members being Ridgeway, Reihill and CCE chief ops officer Paul Latham.

The directors of the Hamsard holding company will be Desmond, Ridgeway, Reihill and Rapino, appointments that are expected to be ratified at the next board meeting.

Although CCE is in the process of being spun off by Clear Channel Communications, and may well become a private company itself, Rapino said it will have no impact on Hamsard’s plans for the Fiddler.

At the moment, those plans include the company keeping its brand name and continuing to be run from its Harlesden offices. Rapino said there are no plans to move the dates of the Fiddler’s Reading and Leeds festivals.

Although both fall in the same month as the V Festivals at Chelmsford and Weston, in which Desmond has a major stake, it’s not unusual for all four to sell out.

As far as Mean Fiddler’s venues are concerned, Rapino was a little more guarded, saying, “We’ve only just taken control this week and will perform a thorough review of all assets over the next couple of months to assess what changes are required.”

Clear Channel already has London venues including the Carling Apollo Hammersmith and the Dominion, Lyceum and Victoria theatres. Desmond – via his shares in Academy Music Group – has a stake in Brixton Academy, Islington Academy and Shepherds Bush Empire, while Mean Fiddler has The Astoria, The Forum, The Mean Fiddler, The Garage, and smaller boutique venues like Jazz Caé and Borderline.

Three months ago, Ridgeway told Pollstar, “This will now enable us to host a full range of London gigs from capacities of 500 right up to 5,000,” although that could still be achieved without all of them remaining open.

As for the company’s ambitions and goals, Rapino said the plan is to “to maximise the existing assets both operationally and financially, and to add to those assets as opportunities arise.”

Over the next six months, it may well become clear what “operationally and financially” maximising the assets really entails.

John Gammon