The proposed merger of AEG Facilities and SMG to create the world’s biggest facility management company has been cleared by the U.K.’s Competition and Markets Authority (CMA).
The deal has also been cleared by the U.S. Department of Justice, Billboard has learned and a formnal closing of the agreement is expected early next month. First announced in February, the agreement between AEG Facilities and Onex, owner of facility operator SMG, gives each firm 50% of the new standalone company, which will be headquartered in Los Angeles and called ASM Global.
Led by AEG Facilities President and CEO Bob Newman, the new venture will oversee 310 venues, including Manchester Arena in the U.K. and NFL stadiums like Soldier Field in Chicago, as well as numerous convention centers and performing arts venues in North and South America, Asia, the Middle East and Europe.
Given the size of the deal and dominant market share ASM Global will control as a result, the proposals naturally drew the interest of competition regulators and in April the CMA launched a preliminary ‘phase 1’ investigation into the merger, following a deferment by the European Commission.
That investigation has now been completed with the CMA concluding that the merger would not result in a substantial lessening of competition within the U.K market.
Welcoming the news, a spokesperson for AEG said in a statement: “We are pleased that the proposed merger of AEG Facilities and SMG has received unconditional clearance from the U.K. Competition and Markets Authority (CMA).” SMG is yet to comment.
The deal does not include properties and entertainment districts owned by AEG in Los Angeles, London, Hamburg and Berlin, or those under development. Instead AEG Facilities’ contracts for venue development will make up AEG’s main contribution to the merger, while Onex is contributing its entire equity investment in SMG to the new global entity.
“This isn’t about cost savings, it’s about combining complimentary assets to create something very special,” Newman told Billboard when the plans were first announced in February.
Calling SMG a “great company with an amazing and deep stable of fantastic employees,” Newman said he was looking forward to combining it with AEG Facilities “into one family.”