Financial terms were not disclosed but a source familiar with the situation said the transaction values Ambassador at £350 million ($565 million, €413 million). Providence is investing in the company using capital from its Fund VII, which closed on $5 billion in July. UBS Investment Bank was the financial advisor to both private equity firms.
Exponent has been a shareholder in Ambassador since 2009. The firm will retain a minority stake in the business and will continue to work with the theatre group’s management team alongside Providence.
Ambassador has “continued to achieve steady year-on-year growth” according to a statement, and was featured in the 2013 Sunday Times Profit Track 100, which ranks private UK businesses based on growth over a three year period. The company recently purchased Foxwoods Theatre, which bills itself as the largest theatre on Broadway, and intends to continues expanding internationally in North America, Asia and Australia.
Other live event media companies in Providence's portfolio include MLS Media, the media and marketing and sponsorship business of Major League Soccer, and Ironman founder World Triathlon Corporation. Providence also
has invested in companies such as Yankees Entertainment and Sports Network, which is a 24/7 network featuring the New York Yankees baseball team and video game developer and distributor ZeniMax Media.
“We believe strongly in the long term value of live entertainment,” Providence managing director Andrew Tisdale said in the statement. “[Ambassador Theatre Group] is well-known for the high quality of its theatrical and musical content and venues”.
Providence closed Fund VII, a 2011 vintage, on $5 billion after a challenging fundraising campaign that saw the firm reduce the fund’s target from $6 billion and request a fundraising extension from investors, which was granted. Ambassador marks Providence's third investment from the fund. The firm declined to disclose what percentage of the fund has been invested to date.
Providence collected $12 billion for its Fund VI in 2007. It is unclear whether the difference in size between Fund VII and its predecessor will require Providence to downsize its organisation, but several top executives have left the firm or stepped back recently, including Julie Fisher, head of investor relations, and Patrick Corso, a senior managing director. Corso is one of four departures from Providence’s Asia operations. In May, Providence hired Renée Beaumont as a managing director and global head of business development, Private Equity International previously reported, and in March, the firm hired senior managing director Richard Byrne from Deutsche Bank to join the credit group.
Ambassador has more than 40 venues in the UK and on Broadway in New York. The company issues more than 10 million tickets each year. Sir Howard Panter and Rosemary Squire founded the group in 1992 and will remain very involved in the business going forward, according to the source.