The deal is done and dusted. After first being rumored about a month ago, Live Nation has officially acquired Governors Ball owners Founders Entertainment. Terms of the deal have not been revealed, but it will give Founders more breathing room to take risks and possibly expand without worrying about one failure bankrupting the company.
"These events are so high-risk for us that if we were to launch a new event and it were to fail, it would cripple us," said Tom Russell one of the majority partners at Founders to the New York Times. "By partnering up with a company that empowers entrepreneurs," he said, Founders would "not have the fear that a new venture would really put us in the street."
The deal comes after months by Governors Ball of trumpeting their independent status as a way of differentiating itself from AEG's new festival on Randall's Island, Panorama. They had lobbied publically and privately to remain the sole big New York multi-genre festival, claiming that Panorama could put it in jeopardy. The deal with Live Nation now invalidates those indie claims, though Founders says it will still present the festival on its own.
This follows a pattern for Live Nation of consolidating the festival market under its own massive live event umbrella. In 2013 it acquired a majority stake in Insomniac Events, which puts on Electric Daisy Carnival, as well as its competitor, Hard Events. In 2014 it took a stake in C3 Presents, which has Lollapalooza and Austin City Limits, among others, on its portfolio. Last year it acquired Bonnaroo.
"Our goal is to continue to be a global consolidator of the live music business," said Michael Rapino, CEO of Live Nation to the NY Times. "There are still a ton of great festivals, in a ton of markets, in a ton of cities that we would love to continue to build our portfolio on."
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