Anschutz Entertainment Group
POWER MOVE: The top-grossing arena in the world (London’s O2), the industry leading festival (Coachella), $5 billion in real estate and key execs with new, long-term contracts -- all part of Leiweke’s strategy that may drive value to the tune of $8 billion.
THE RUNDOWN: The architect behind Anshutz Entertainment Group, president/CEO Tim Leiweke delivered big-time for founder/owner -- and now seller -- Philip Anschutz, the Denver multibillionaire who put AEG on the block last November with a price tag that could ultimately reach $8 billion.
That such a big number is even being floated stands as testament to Leiweke’s skill of combining world-class theaters, arenas and stadiums with revenue-producing sports teams and live events, as well as such add-on businesses as ticketing, merchandising and sponsorships. AEG Live, the company’s content arm that owns, operates and exclusively books 35 venues, has produced many of the highest-grossing tours of the last decade. AEG’s festival division produces branded events including Coachella (which grossed an industry-leading $47 million in 2012), Stagecoach and New Orleans’ Jazz & Heritage Festival. AEG Live reported a total gross of $576 million in 2012, second only to Live Nation, and is positioned for even higher grosses in 2013, Leiweke says, driven by both festivals and new tours by Bon Jovi, Taylor Swift, Kenny Chesney and Justin Bieber, among others.
AEG’s real estate assets drive the business. Its arenas alone are estimated to be worth more than $5 billion, with AEG either owning venues or holding long-term operating leases in major markets worldwide. Indeed, its entire portfolio of arenas, theaters, stadiums and clubs on five continents exceeds 100 buildings, with 42 million concert-goers attending AEG shows last year, according to the company.
Besides the real estate are other venue revenue streams that virtually print money: food concessions, on-site parking, corporate suites, sponsorships and AEG’s new ticketing company, AXS, which could be operating in all of its buildings by year’s end. These ancillaries hinge on strong bookings, and AEG’s O2 in London was the top-grossing arena in the world last year, bringing in nearly $110 million, according to Billboard Boxscore, with AEG’s Staples Center in Los Angeles and Allphones Arena in Sydney placing third and seventh, respectively.
Perhaps preparing for the ownership change, Leiweke secured AEG’s top executives with new, long-term contracts. He doesn’t seem overly concerned about his own prospects, however. “I’ll serve at the will and the mercy of the new owners,” he says. “If it’s not meant to be, I’m fairly certain I’ll keep myself busy.”