AEG Interested In Barclays

Investment bank Evercore Partners was expected to start formally shopping developer Forest City Ratner’s 55 percent stake early last month, and Guggenheim Partners was rumored to be a potential buyer at that time.

A lot can change in a month. The New York Post now reports that AEG is expected to decide by Dec. 31 whether to continue talks or walk away, though no one from either party is talking for the record.

The venue, which ended its inaugural year as North America’s top-grossing arena and is on pace to repeat for 2014, is thought to be valued at $750 million, according to Sports Business Daily.

Sources said to have knowledge of the talks told the Post that AEG is willing to pony up $500 million, which the paper says is roughly 12 times Barclays’ expected $40 million in operating profits for the year.

Forest City last month forecast profits would rise 63 percent in 2016 to $65 million, and is said to be seeking a sale price well north of AEG’s reported limit.

“AEG will not overspend,” the source told the Post. “If Forest City Enterprises is rational a deal could happen.” Live Nation is still expected to at least take a look at Barclays Center. AEG provides some operational support at Barclays but does not operate or have an ownership stake in the building. It’s also currently building a 20,000-seat arena in Las Vegas.

With Guggenheim Partners believed out of running as a potential suitor, the Post reports that AEG is likely the only partner considering purchasing the entire Forest City stake. Russian billionaire and Brooklyn Nets owner Mikhail Prokhorov owns the remaining 45 percent stake in the Barclays Center, and sources told the Post he may sell most if not all of his stake.