First announced in July 2019, the agreement took 10 months to win the approval of Mexican regulators, only to collapse in May 2020 as a result of the global pandemic and concert industry shutdown.
Citing a "material adverse effect," CEO Michael Rapino announced that the deal was being put on hold during a May 7, 2020, earnings call, saying company officials wanted to "evaluate the impact of the global COVID-19 pandemic on OCESA’s business and operations" in Mexico and the rest of Latin America.
“Long-term we’re still bullish on their business and ours, we want to be in business with OCESA and get the deal done, but we’re not sure where Mexico stands” with COVID-19 crisis, Rapino told analysts on the 2020 earnings call. “I'm not looking to take on any losses from Mexico while they're going through their six or eight months of a business downturn and come out the other side. Ideally we'd want to get the deal done, we want to delay the cash payment of the deal until we know we are on the other side of this crisis -- that’s the intent.”
OCESA opposed the May 2020 decision and on May 25, Live Nation filed a petition for with the International Court of Arbitration seeking a declaratory judgement that Live Nation had the right to terminated their agreement with Corporación Interamericana de Entretenimiento. Both sides reached a settlement on Monday to suspend the arbitration hearing and move forward with the sale. The agreement may be terminated by either party if the acquisition doesn't close by June 12, 2022.
The agreement gives the world's largest promoter control of an average of 3,100 events annually with 6 million attendees in Mexico and Colombia every year.
In 2019 OCESA/CIE was the third highest grossing promoter on the Billboard Year-End Boxscore charts, only behind Live Nation and AEG, reporting $233.2 million in ticket sales for 936 events in front of 4.3 million fans.
Live Nation's share price closed 2.41% down at $86.54 on Wednesday. Since the deal's revival was announced Monday morning, the company stock has held steady with a slight .4%. increase in a share price and little to know change in trading volume.