Two of the music industry’s powers, Eagles manager Irving Azoff and MSG leader James Dolan, are ditching their joint venture, shifting industry dynamics.
Two titans in live music are ending their five-year relationship, as music manager Irving Azoff buys his partner, MSG executive chairman/CEO James Dolan, out of their joint venture, Azoff MSG Entertainment, for $125 million.
The split comes after Azoff and Dolan reopened The Forum together in Los Angeles in 2014 and turned it into the state’s highest-grossing concert venue, partially containing their biggest competitor, AEG owner Phil Anschutz, who owns the Staples Center arena nearby. The pair recently scored a key victory in their ongoing turf battle with Anschutz when AEG dropped its requirement that artists wanting to play the top-grossing O2 Arena in London also had to play the Staples Center (and not The Forum) when performing in Los Angeles.
But despite the win, Azoff’s and Dolan’s visions for Azoff MSG Entertainment had begun to diverge, and both sides opted to trigger a buyout clause that took effect five years into the deal. Sources say the move was a “conscious uncoupling,” as Azoff family friend Gwyneth Paltrow once described her split from former husband Chris Martin of Coldplay.
Azoff is calling his new holding company The Azoff Co. It includes Full Stop Management, a division he runs with his son Jeffrey Azoff and partner Brandon Creed, with marquee clients that include the Eagles, Charli XCX, Harry Styles and HAIM.
Dolan, meanwhile, is preparing to spin off his company’s sports business to focus on the $1 billion MSG Sphere venues in Las Vegas and London, a project that never gained much enthusiasm from Azoff or his venue partner, Oak View Group co-founder Tim Leiweke. As part of the buyout, The Azoff Co. will purchase MSG’s stake in OVG, while an outstanding $63.5 million revolving term loan extended by MSG to Azoff MSG Entertainment will be converted to a term loan with a maturity date of Sept. 20, 2021, and assumed by The Azoff Co. The transaction — subject to certain conditions, including Azoff Music obtaining financing — is expected to close before Dec. 31.
The buyout represents the end of a partnership that was supposed to shake up the fragmented music landscape, combining MSG’s marquee venues with Azoff’s artist ties and his performing-rights group, Global Music Rights, which seeks higher royalty payments for its songwriters.
The Forum, the 1960s-era arena that MSG purchased in 2012 and reopened following a $100 million renovation, anchored the relationship, with Irving’s wife, Shelli Azoff, initially overseeing the venue as managing partner. The arena successfully picked off dozens of shows from the Staples Center and took the bulk of Live Nation’s arena business, but also saw high employee turnover as more than a dozen venue executives came and went. In December 2017, Shelli Azoff announced she was stepping down from her role at the arena, and GM Nick Spampanato exited in June. The two were replaced by vp operations Rick Merrill, as well as vp booking Geni Lincoln and head of artist relations and VIP services Jillian Lentz.
The Azoffs will still have a presence at the building, though: Prior to closing the buyout, Azoff and Dolan signed several multiyear consultancy agreements for The Forum and the new Sphere venues.
“It’s a split, but it’s one where everyone leaves happy,” says a source close to the negotiations. “[Dolan and Azoff] are two larger-than-life figures, and their partnership would inevitably have an expiration date.” Talks to close the joint venture have been ongoing since the beginning of the year.