Madison Square Garden Co. (MSG:US) will pay $22.5 million to buy a 50 percent stake in Tribeca Enterprises, owners of the film festival co-founded by actor Robert De Niro in the wake of the Sept. 11, 2001, terrorist attacks.
The investment valued Tribeca at $45 million and New York-based MSG will have the opportunity to gain majority ownership over time, according to a statement yesterday.
The partnership plans to capitalize on MSG’s collection of entertainment venues, including New York’s Madison Square Garden and Radio City Music Hall, and marketing skills to expand the festival and the brand, according to the companies.
The deal “is another example of our continued focus on pursuing attractive growth opportunities,” Tad Smith, MSG’s chief executive officer, said in the statement.
Separately, MSG is trying to sell Fuse, its music cable channel. Interested buyers include Sean “Diddy” Combs and NuvoTV, which is backed by Jennifer Lopez, people with knowledge of the matter said on March 14. MSG will select a winning bid by the end of this month, said the people, who asked not to be identified because the process is private.
Artist Series Inc. emerged as another suitor yesterday with an offer of $350 million, though it said it hasn’t lined up financing yet. That’s above previous bids of about $200 million.
De Niro, along with Jane Rosenthal and Craig Hatkoff, established Tribeca Enterprises in 2003, a year after the first film festival took place in Lower Manhattan in a bid to stimulate the local economy about 10 months after the attacks on the World Trade Center. Rosenthal will continue as CEO of the company, according to the statement.
James Dolan, MSG’s chairman, will join the Tribeca board, according to MSG spokeswoman Kimberly Kerns.
Kerns and Tammie Rosen, a spokeswoman for Tribeca, declined to comment on Tribeca’s annual revenue and profit as well as its ownership breakdown before the deal.
MSG, which also owns the New York Knicks and Rangers, had advanced 1.3 percent this year to $58.34 through March 21. The Standard & Poor’s 500 Index gained 1 percent during the same period.
To contact the reporter on this story: Matt Townsend in New York at email@example.com
To contact the editors responsible for this story: Robin Ajello at firstname.lastname@example.org Mary Romano, Sylvia Wier