Legends ‘blockbuster deal’ to buy ASM Global

Article posted by Coliseum, July 13^th, 2023

Image: ASM Global

The premium experiences company Legends is in discussions to acquire ASM Global, multiple sources said, a blockbuster deal potentially that would propel Legends into a major force across all facets of facility development and operations, but ultimately result in fewer options for running sports and entertainment venues.

‘VenuesNow’ stated that at this point, its unclear where both parties are in the process of a potential merger, whether a deal has been signed and when it would officially be announced, sources said.

Officials with both Legends and ASM Global declined to comment.

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Founded in 2008, New York (US)-based Legends is a premium experiences company with six divisions operating worldwide – Global Planning, Global Sales, Hospitality, Global Partnerships, Global Merchandise, and Global Technology Solutions – offering clients and partners a 360-degree service solution platform to elevate their brand and execute their vision.

Currently, Legends works with marquee clients across business verticals including professional sports, collegiate, attractions, entertainment, and conventions and leisure. They are the industry leaders in designing, planning and realizing exceptional experiences in sports and entertainment.

Los Angeles (US)-based ASM Global, a private management firm, runs about 350 arenas, stadiums and convention centers worldwide, including a dozen National Football League (NFL) and National Basketball Association (NBA) venues, some of which are booking deals and other service agreements. The merger would effectively add facility operations as the final piece of Legends’ 360-degree business model and further shrink the industry through consolidation.

‘VenuesNow’ further stated that ASM Global has reportedly been in play for a while now with efforts accelerating over the past two months to sell the company, sources said.

In early May, Mergermarket, a website covering the financial sector, and which is part of Ion Analytics, posted a story that said Onex Corporation, a Toronto (Canada)-based private equity firm that owns 50 percent of ASM Global, had asked Goldman Sachs to oversee a formal sales process for the company.

New York (US)-based the Goldman Sachs Group, Inc. is an American multinational investment bank and financial services company.

The AEG Facilities owns the remaining 50 percent of ASM Global after it merged with the old Spectator Management Group (SMG) to form a standalone company in 2019. Onex and Goldman Sachs, serving in an advisory role, invited a “limited number of prospective buyers to express interest in ASM”, the site reported.

For Legends, among those suitors, the one piece that’s been missing over the past 15 years is running public assembly venues.

Pending completion of the ASM Global transaction, Legends would immediately become the industry’s biggest third-party facility Manager, forging a strong connection to its existing lines of business in feasibility studies and market research, owner’s representation/project management, food service and merchandise, and premium seat and sponsorship sales, including naming rights consultation.

The merger brings back some familiar ties and personnel involved in the Legends-ASM Global agreement.

The deal would reunite Legends head honcho Shervin Mirhashemi and AEG in one sense. Mirhashemi spent 12 years with AEG and became the company’s top sales executive and the President of AEG Global Partnerships before he departed for Legends in 2013.

Los Angeles (US)-based the Anschutz Entertainment Group, also known as AEG Worldwide, is an American global sporting and music entertainment presenter and a subsidiary of The Anschutz Corporation. It is the world’s largest owner of sports teams and sports events.

The AEG Global Partnerships creates innovative experiences for brands to reach their desired audience at relevant moments, both in person and online. It is constantly working to deliver the best entertainment experience for millions of engaged sports and live music fans throughout the world.

In addition, Goldman Sachs was the original investment bank behind Legends at the time it launched in 2008, before selling its stake in 2012 after the finance executive Gerry Cardinale left the bank.

Goldman Sachs also advised on the deal for Sixth Street, a private equity firm with $60 billion in assets under management, to purchase a majority stake of 51 percent in Legends. That transaction was completed in early 2021.

At that time, the acquisition valued Legends at $1.35 billion, according to Legends’ website. The NFL team Dallas Cowboys and the Major League Baseball (MLB) team New York Yankees remain the other two partners in Legends, which they initially formed to provide food service for the 80,000-capacity AT&T Stadium in Arlington, Texas, and the 46,537-capacity Yankee Stadium in New York, two buildings that opened in 2009.

The potential merger between Legends and ASM Global is seen as a counter strike to the Oak View Group (owner of VenuesNow and Pollstar magazines), which has quickly grown to become a formidable competitor across the sports and entertainment landscape since its inception in 2015.

The OVG Oak View Group, LLC is an American Global Advisory, Development and Investment Company for Sports and Live Entertainment industries. Based in Los Angeles, it was formed on November 16th, 2015 by Tim Leiweke and his business partner, Irving Azoff. Leiweke is the company’s Chief Executive Officer (CEO).

Two years ago, OVG, co-owned by Leiweke, the former head honcho of AEG, and Azoff, among the music industry’s most powerful brokers, acquired Spectra, a provider of facility management, food service and marketing services. The transaction vaulted OVG into position as the second-biggest firm in that space behind ASM Global.

Buying ASM Global enables Legends to keep pace with OVG’s rapid expansion, experts said.

Said Ed Rubinstein, a veteran Arena Manager and merchandizer with 50 years of experience, “Shervin wants to get into the venue management biz and he’s a former AEG guy. Legends bring a lot of other business segments to the table that ASM doesn’t really have or excel at, sponsorship and premium sales being two. It makes Legends a major competitor to OVG and Shervin’s former boss, Tim Leiweke.”

The volume and scale of the OVG-Spectra merger, plus the deals OVG has compiled over the past eight years to privately finance the development of multiple big league arenas, coupled with the red-hot market for live entertainment two years after the pandemic, has created a situation where it makes sense for Legends to expand its portfolio and get into more buildings apart from concessions and premium dining, industry experts said.

Stated Chris Bigelow, a food service consultant, “They’ve been successful in feasibility studies, project management and ticketing strategies, but their food and beverage unit really hasn’t done much. In the beginning, they thought it was going to be a slam dunk, but it hasn’t worked out that way. They’ve typically picked up deals, like with Stan Kroenke’s teams, because of some connection (with Cowboys owner Jerry Jones). They haven’t won stuff in an open bidding process.”

Added Mike McGee, a Consultant and Co-Founder of Leisure Management International, which ran big league arenas and stadiums from 1984 to 2000 before he sold the company to SMG, “Without knowing what Legends’ vision is long term, it’s hard to comment, but it certainly has the potential of being impactful in numerous ways that would be directly competitive to OVG. It sounds like the price of ‘the game’ is going to get more expensive as the industry shrinks with more consolidation.”

Another factor possibly driving the Legends-ASM Global deal is Phil Anschutz, owner of AEG, is now 83-years-old. McGee said Anschutz may feel that he needs to start liquidating his assets before he dies, including his company’s stake in ASM Global.

ASM Global does have Savor, its in-house food provider that was originally part of SMG, plus marketing and event promotions and booking services. Its unclear how those divisions would move forward and whether they would be folded into the proposed Legends merger.

The same question surfaces for Levy, the Chicago concessionaire. Compass Group, the world’s biggest food service provider and Levy’s owner, has a 49 percent ownership stake in AEG Facilities. Levy and Legends are competitors in running food and merchandise at arenas and stadiums. Legends have also been strong on the retail end as the NFL’s official vendor for Super Bowl, among other accounts.

Bigelow said Legends could potentially integrate Savor, whose primary business is convention centers, into its food operation, while the Compass Group gets a nice payout to separate itself from ASM Global.

There’s a lot at stake and a lot to shake out if Legends completes its acquisition of ASM Global, but one thing is certain: An already small world in the public assembly venues biz is about to get a whole lot smaller.

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