KKR to Acquire Pan-European Live Entertainment Group Superstruct from Providence Equity Partners

Rhea-AI Summary

KKR, a global investment firm, announced the acquisition of Superstruct Entertainment, a leading European live entertainment group, from Providence Equity Partners. Financial specifics were not disclosed.

Superstruct, founded in 2017, owns and operates over 80 music festivals in Europe and Australia, including Wacken Open Air, Defqon.1, and Sónar. Under KKR's support, Superstruct aims to further global growth and professionalize the fragmented live entertainment sector.

Providence retains an option to invest €250 million in Superstruct. KKR will leverage its expertise in digital entertainment and extensive network to support Superstruct's expansion.

Positive

• KKR's acquisition of Superstruct positions it for global growth.
• Superstruct's portfolio includes over 80 major music festivals in 10 countries.
• KKR's support will help professionalize the live entertainment sector.
• Providence retains an option to invest €250 million in Superstruct.

Negative

• None.

Financial Analyst

KKR's acquisition of Superstruct Entertainment is a strategic move that highlights the increasing value of the live entertainment sector. KKR's support can provide Superstruct with €250 million in potential investments from Providence, which underscores the financial confidence in the company's future.

This acquisition is significant for several reasons. Firstly, KKR's experience with similar investments such as BMG and ProSiebenSat1 indicates their capability to enhance Superstruct's operations and market reach. For retail investors, this implies that Superstruct might experience substantial growth under KKR's ownership, potentially leading to enhanced revenue and profitability.

Market diversification is another critical factor. Superstruct's portfolio covers a wide range of music festivals across multiple countries, reducing the risk associated with dependency on a single market. This diversification can provide more stable and predictable revenue streams, which is vital for investor confidence.

However, it is necessary to consider the competitive landscape. The live entertainment industry is highly fragmented and competitive. While KKR's support can foster growth, the need for continuous innovation and adaptation to consumer preferences remains high. Additionally, the impact of economic downturns on discretionary spending can affect the demand for live events.

In summary, this acquisition showcases a robust partnership and promising growth prospects for Superstruct. However, investors should remain aware of the inherent industry risks.

Market Research Analyst

The acquisition of Superstruct by KKR reflects a broader trend in the live entertainment industry where consumer preferences are shifting towards experiential spending. This shift is important for investors to understand as it signals a steady demand for live events, which bolsters the long-term growth potential of companies like Superstruct.

One key insight is the resilience demonstrated by Superstruct in emerging stronger post-pandemic. This resilience can be attributed to the diverse portfolio of festivals and the geographical diversification, which mitigates localized risks and enhances overall business stability. For investors, this resilience indicates a well-managed company capable of navigating significant disruptions.

Furthermore, KKR's extensive experience in the TMT (Technology, Media and Telecommunications) sector can facilitate Superstruct's digital transformation and innovation in ticketing and event management. These advancements can enhance customer experiences and operational efficiencies, driving growth and profitability.

Nevertheless, the live entertainment sector is affected by several external factors such as economic fluctuations and changing consumer behavior. Hence, while the acquisition presents numerous opportunities, it is not devoid of risks.

In conclusion, this acquisition aligns with the evolving market trends and highlights Superstruct's potential for growth. Investors should consider both the opportunities and risks this dynamic industry presents.

Investment supports Superstruct’s ambition to become a global leader in music festivals and live events

LONDON--(BUSINESS WIRE)-- KKR, a leading global investment firm, today announces the acquisition of Superstruct Entertainment (“Superstruct” or the “Company”), from Providence Equity Partners (“Providence”), a premier private equity firm specializing in growth-oriented investments in media, communications, education and technology. Financial terms of the transaction were not disclosed.

Superstruct is an entrepreneurial and leading European live entertainment group, owning and operating over 80 music festivals across 10 countries in Europe and Australia. Since its establishment in 2017 by Providence, Superstruct has grown organically and through acquisitions into one of the world’s premier live entertainment groups. Today, the company has a well-diversified portfolio across music genres and geographies. The portfolio includes some of Europe’s most popular and high-quality festivals, such as Wacken Open Air, Defqon.1, Parookaville, Sziget, Tinderbox, Boardmasters and Sónar.

Demand for live entertainment has grown significantly over the past decade and is expected to continue to expand, as consumer spending continues to shift from goods towards experience. KKR will support Superstruct in its next phase of development as one of the key players in a highly fragmented sector that continues to grow, expand and professionalise, whilst preserving the creative and cultural DNA of the Company.

As part of the transaction, Providence has an option to invest €250 million into Superstruct.

Philipp Freise, Partner and Co-Head of European Private Equity and Franziska Kayser, Partner at KKR, said: “We are delighted to partner with Roderik Schlösser, James Barton and the team at Superstruct who have established themselves as a leader in delivering unparalleled live music experiences globally. With a robust foundation as a top-tier live entertainment platform, we see significant growth opportunities ahead for Superstruct. Drawing on our strong partnership approach and experience in the digital entertainment and ticketing space, such as BMG, ProSiebenSat1, GetYourGuide, and Trainline, as well as KKR’s global resources and extensive network, we will support the company and its entrepreneurial team to bring their compelling portfolio of live event formats to a wider audience and drive further growth.”

Andrew Tisdale, Senior Managing Director and Daniel Zwicky, Director at Providence Equity Partners, said: “We are incredibly proud of the rapid growth and success Superstruct has achieved since its inception. With Providence’s backing, Superstruct has become a truly exceptional live entertainment company. In particular, we believe the Company’s resilience and emergence from the global pandemic as a stronger business is testament to the entrepreneurial spirit of Roderik Schlösser, James Barton and the impressive management team. We are confident that with KKR’s support, Superstruct will continue to thrive.”

Roderik Schlösser, CEO and James Barton, Chairman of Superstruct Entertainment said: “The founding vision for Superstruct was to create a natural home for successful entrepreneurs, creative visionaries, and business-minded professionals in live entertainment. We wanted to create a network of influence setting the standards for live experiences. Through our development, we are a leader in the professionalization of this industry, enabling our dedicated teams to excel in a collaborative and inspiring environment and create and deliver best-in-class events for millions of fans. We are proud to have secured the backing of KKR, whose expertise and network will strengthen our ability to scale and innovate in the vibrant experiential economy. We would like to thank Andrew Tisdale, Daniel Zwicky and the team at Providence for their outstanding support. Their belief in Superstruct has been fundamental to our success.”

KKR has an extensive European track record and operational experience in developing regional platform businesses in the consumer and TMT sectors, including investments in Trainline, GetYourGuide, Mediawan/Leonine, ProSiebenSat1, GfK and Axel Springer. With its investment in Superstruct, KKR will draw from direct experience working with independent music businesses, including global music company BMG, helping the business deliver its vision of supporting songwriters and treasuring their artistry. KKR is making the investment in Superstruct through its European Fund VI, an $8 billion fund that invests in the growth of leading businesses by providing access to KKR’s extensive network and business building resources. Recent investments from European Fund VI include FGS Global, OHB and Nexeye. Across all investments, KKR is differentiated by its strong partnership approach in working closely with portfolio company management teams through their transformation and growth.

Goldman Sachs is acting as financial advisor and Kirkland & Ellis as legal advisor to KKR. Providence is being advised by HSBC and LionTree as joint financial advisors, and White & Case as legal advisor.

About KKR

KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKRs website at www.kkr.com. For additional information about Global Atlantic Financial Group, please visit Global Atlantic Financial Group’s website at www.globalatlantic.com.

About Providence Equity Partners

Providence Equity Partners is a specialist private equity investment firm focused on growth-oriented media, communications, education and technology companies across North America and Europe. Providence combines its partnership approach to investing with deep industry expertise to help management teams build exceptional businesses and generate attractive returns. Since its founding in 1989, Providence has invested over $36 billion across more than 175 private equity portfolio companies. With its headquarters in Providence, RI, the firm also has offices in New York, London, Boston and Atlanta. For more information, please visit www.provequity.com.

About Superstruct Entertainment

Founded in 2017 by James Barton and Roderik Schlosser, Superstruct is a European leader in live entertainment. Its well-diversified portfolio includes some of Europe’s most popular festivals and live event formats, among them Flow, Arenal Sound, Zwarte Cross, elrow, Victorious, Resurrection Fest and Lost Village, alongside established capabilities in brand partnerships, merchandise, staging and travel solutions. To connect with Superstruct, visit www.superstruct.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240621755499/en/

KKR:

Alastair Elwen / Mei Futonaka

FGS Global

+44 20 7251 3801

KKR-LON@fgsglobal.com



Providence Equity Partners:

Charlie Chichester / Rory King

FGS Global

+44 20 7251 3801

ProvidenceEquity@fgsglobal.com

Source: KKR

FAQ

What is the significance of KKR acquiring Superstruct Entertainment?

KKR's acquisition of Superstruct Entertainment supports its ambition to become a global leader in live entertainment, leveraging KKR's resources for further growth.

What does Superstruct Entertainment specialize in?

Superstruct Entertainment specializes in owning and operating over 80 music festivals across Europe and Australia, making it a leading group in live entertainment.

How does the acquisition of Superstruct impact KKR?

The acquisition will enable KKR to expand its presence in the live entertainment sector, supporting Superstruct's growth and professionalization in a fragmented market.

What is the role of Providence Equity Partners post-acquisition?

Providence Equity Partners retains an option to invest €250 million in Superstruct, continuing its relationship with the company.

What are some key festivals in Superstruct's portfolio?

Superstruct's portfolio includes prominent festivals such as Wacken Open Air, Defqon.1, Parookaville, Sziget, Tinderbox, Boardmasters, and Sónar.