LN / TM Merger Approaching?

Live Nation and Ticketmaster reportedly met last night, Feb. 8, with a merger to be announced as early as today.

The board meetings, held right after the Grammys, would announce the attempt to form Live Nation Entertainment, according to the Wall Street Journal. Initial reports had the name as Live Nation Ticketmaster. All but final negotiations were completed Feb. 8, with an announcement due as early as today or tomorrow, the WSJ reported.

Live Nation CEO Michael Rapino would retain his title in the new company, and Ticketmaster CEO Irving Azoff would be named executive chairman, retaining his control of Front Line Management, the paper said. Barry Diller, TM’s chairman, will be named nonexecutive chairman.

Sources told the WSJ the merger is expected to pass regulation with ease because the two companies are not competitors. Industry foes, however, fear the merger would exert undue influence – a venue, for instance, would feel pressure to renew its Ticketmaster contract lest it find Front Line artists or Live Nation tours diverting concerts from the facility.

One expert told the WSJ regulators could oppose the merger because of its “vertical” integration model, although that has not been the case of late. President Barack Obama’s new administration, though, may oppose the deal considering the public’s animosity toward both companies, the paper noted.

Both companies would have 50 percent interest in the new entity, sources told the New York Post. TM investors would receive roughly 18 percent more shares than LN shareholders because the latter has a larger base.

Sources told the Post that Diller and Azoff would eventually remove Rapino and the rest of his team.

“Irving’s spent a lot of time being ‘Rapino’s buddy,’ but what he really was doing was getting to know Live Nation’s business so he can take the whole thing over,” an executive who has negotiated deals with both men told the paper.

Another source said, “Rapino’s in a pool of sharks and he’s the bait. He’s going to get sucked up and killed by Azoff and Diller.”

Rapino allegedly insisted Diller be nonexecutive chairman of the company rather than Diller’s original title of chairman. Azoff and Rapino would act as co-CEOs, with Rapino handling operations and Azoff handling artist management and production.

“They’ll work together like oil and water,” a source told the Post. “It’ll be a matter of months before one tries to overthrow the other.”