Trojan: division pulled off the block.
The concert division of House of Blues Entertainment is now off the block, Billboard.biz has learned.
HOB CEO Greg Trojan informed employees of the live-entertainment company yesterday (April 12) that a sale was not forthcoming. An official announcement is expected later today.
The news comes after HOB announced late last year that it had retained global financial services firm UBS to evaluate the potential sale of its concert division, which Trojan defines as "anything not part of the club business."
"We feel like retaining our concert business will generate more growth for House of Blues than selling it," Trojan tells Billboard.biz. While he would not comment on specifics, Trojan says, "We had offers, firm formal offers in this process, but nothing was compelling enough for us to move forward."
This is the second time HOB has gone through this process. In 2002, the company retained investment banking firm Allen & Co. to find a buyer for some of its assets. HOB was pulled off the market in November of that year.
HOB owns, operates or exclusively books 20 arenas and amphitheaters in North America. Concert assets include amphitheaters, the company's booking agreements and the outside promotion business in HOB markets in the United States and Canada.
The company acquired its concert division for $190 million in 1999 from Seagram, which operated the unit as Universal Concerts. HOB reported concert grosses totaling $250 million in 2004, according to Billboard Boxscore.
Trojan says HOB "happily remains in the concert business, and we intend to be in it for a long time. We did not come at this process from a gloomy perspective. But I'm not sure others share our optimism."
Trojan says he is "glad this process is over," and that HOB is off to a strong start in 2005. The company has adopted an aggressive stance in the club market since orchestrating a $110 million recapitalization plan last March. HOB opened an eighth club in Cleveland last month; a ninth club opened in San Diego this spring, and a new club in partnership with Harrah's in Atlantic City, N.J., opens in July.
Additionally, three more clubs are expected to open this year or early next year.