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Ron Burkle invests in concert promotion, film production firms

Former supermarket mogul Ron Burkle buys concert booking company Artist Group International and takes a stake in independent movie studio Relativity Media.

January 06, 2012|By Alex Pham and Ben Fritz, Los Angeles Times
  • Ron Burkle is going into the live music business by purchasing New York concert booking agency Artist Group International. He also is investing in the film business by taking a stake in independent movie studio Relativity Media.
Ron Burkle is going into the live music business by purchasing New York concert… (Keith Srakocic, Associated…)

Billionaire Ron Burkle has added movie production and concert promotion to the arenas he wants to play in.

The man who made his fortune bagging supermarket chains and selling them off for billions went into the live music business Thursday by purchasing Artist Group International, a New York agency that books concerts for Billy Joel, Metallica and others.

He concurrently invested in the movie business by taking a stake in independent movie studio Relativity Media.

Y Entertainment group, a newly formed subsidiary of Burkle's investment firm Yucaipa Cos., made the two deals separately for undisclosed sums of money.

But the minority share in Relativity that Y Entertainment bought from private equity firm Elliott Management was previously valued at about $150 million.

Relativity's relationship with Elliott, its only prior investor, had grown strained in the last year amid management and financial troubles at the studio.

The private equity firm, which has $19 billion under management, has been letting Relativity slowly buy down its stake in the last year and has been seeking to exit entirely.

Ryan Kavanaugh, Relativity's chief executive, was previously in talks with JPMorgan Chase & Co. about leading a deal to buy out Elliott.

This past fall, a firm connected to Burkle, Colbeck Capital Management gave Relativity a much-needed $200-million loan that is helping the studio to complete and release several upcoming movies, including the big-budget Snow White tale "Mirror Mirror," starring Julia Roberts, and "Act of Valor," an action movie featuring Navy SEALs.

Relativity has six movies set to come out by April and no others in production.

In 2010, Burkle backed an unsuccessful bid by Harvey and Bob Weinstein to buy back the independent film studio Miramax.

He also previously struck out with efforts to buy Warner Music Group and EMI Group.

EMI went to Universal Music Group while Warner was sold to Access Industries, controlled by fellow Forbes billionaire Len Blavatnik. (Burkle ranks as No. 107 on the Forbes 400 list of the world's richest people, while Blavatnik is No. 32.)

AGI, while not the same size as the top concert promoters Live Nation Entertainment and AEG Live, has survived over the last 25 years as an independent agent, booking concerts for a handful of high-profile clients such as Linkin Park, Def Leppard, Motley Crue and Rod Stewart.

Its chief executive, Dennis Arfa, founded the company in 1986, signing up Billy Joel as one of his first clients. Arfa will continue to run AGI, Yucaipa said in a news release.

The live music and movie businesses aren't the only venues in Burkle's sights. The entrepreneur, who co-owns the Pittsburgh Penguins hockey team, is also mulling over a bid for the Dodgers.

A Yucaipa spokesman confirmed details of the AGI announcement but declined to comment further.

Representatives for Elliott and Relativity declined to comment beyond the company's news release.

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