West End theatre giant lifts curtain on new investor
Written by Rother Radio News on 25/09/2020
The West End entertainment giant which owns the Piccadilly and Apollo theatres is bringing in a new investor to secure new funding aimed at steering it through the coronavirus crisis.
Sky News has learnt that shareholders in Ambassador Theatre Group (ATG) have agreed to sell a small minority stake to TEG, an Australian live entertainment and ticketing business.
The plan will see Providence Equity Partners, which has already injected tens of millions of pounds to support ATG through the pandemic’s initial stages, and TEG providing a total of £160m of new equity to one of the giants of London’s Theatreland, insiders said on Friday.
Lenders to ATG were briefed on the new financing this week, they added.
The injection of new capital by Providence and TEG, which is backed by the media and technology-focused buyout firm Silver Lake, follows a tentative reopening of British theatres.
Social distancing measures and the ‘rule of six’ preventing larger gatherings have combined to prolong the financial crisis facing the industry, with prominent figures such as Lord Lloyd-Webber warning that the arts sector is at “the point of no return”.
MPs on the Commons culture select committee this week called for “a robust strategy” to pave the way for the return of larger audiences in theatres and performance venues.
ATG owns many of the most historic theatres in London, including the Lyceum and Savoy, as well as many other famous sites in Britain, Germany and the US.
Its UK portfolio includes Liverpool’s Empire Theatre, and the Duke of York’s Theatre in London, while on Broadway in Manhattan, it owns the Lyric and Hudson.
The company has a workforce of more than 4,000 full-time equivalent employees.
ATG theatres have been home to some of the world’s most successful plays and musicals, including The Lion King, Les Miserables and Wicked.
Since the COVID-19 outbreak put Britain into lockdown in March, live entertainment groups – like those in many other industries – have scrambled to reorganise their finances.
One source said that an initial equity injection from Providence had been an important first step towards stabilising the business, but that the length of the disruption to the theatre industry meant that new funding was required.
ATG recently announced that all pantomimes would be suspended until the Christmas season next year.
TEG, which owns the Ticketek ticketing brand, was reported earlier this year to be interested in acquiring music venues in the UK which have been impacted by the pandemic.
The size of the stake it is buying in ATG was unclear on Friday morning, but was said to be a “small minority”.
ATG was founded in the 1990s by the husband-and-wife team Sir Howard Panter and Dame Rosemary Squire, who have since gone on to set up a rival theatrical group.
The company is run by Mark Cornell, who joined the company four years ago, having been an executive at the luxury goods owner LVMH and Sotheby’s, the auctioneer.
Providence bought ATG in 2013 in a £350m deal, and has since overseen a stellar increase in revenues and profits, with massive hit shows including Harry Potter and the Cursed Child.
The US-based buyout firm had been preparing to run a sale process for the business during the course of the year, hiring the investment banks Goldman Sachs and Jefferies to oversee an auction.
Providence declined to comment on Friday.
© Sky News 2020