WASSERMAN/GORES UPDATE
The consensus among prominent players in the live business is that a Paradigm-Casey Wasserman deal would be a superb outcome for Paradigm’s music division.
Even so, CEO Sam Gores is telling people that he thinks the deal will not close. Most inside sources are betting it will, even though Tom Gores, being a financial operator, moves with great deliberation. His acquisition of the Detroit Pistons, for example, is said to have taken forever and a half. The younger Gores, having paid off Paradigm’s debt, is now looking at a deal with a drastically smaller price tag than originally anticipated, with a minimized equity position some observers have described as "schmuck insurance."
Meanwhile, UTA's Jeremy Zimmer is likely saying a brucha that the proposed merger didn't go through.
These same sources say the wheels are grinding slowly in part because the key agents involved aren’t willing to move forward with their clients without a new Paradigm management team being installed, and Wasserman (who’s repped by the white-shoe firm of Sullivan & Cromwell) is an attractive strategic partner for those agents critical to making this deal fly. Those include Marty Diamond (Ed Sheeran, Coldplay), Matt Galle (Shawn Mendes, Halsey, My Chemical Romance), Tom Windish and Sara Bollwinkel (Billie Eilish) and Lee Anderson (Skrillex, Zedd, Disclosure).
The agents have all the leverage in making any new deal work for the Goreses and Wasserman, and are all negotiating in their own interest. Can you blame them? They are agents, after all. And some have a high degree of acrimony toward Sam, whom most people seem to like. It's conceivable there could be a better package waiting for them at UTA, CAA or ICM, and there’s still talk of possible startups. It’s believed that Paradigm's heavy debt kept them from ever being very profitable, but Wasserman is not buying that debt.
Still, some say Tom Gores could be committing more capital during an exceptionally volatile moment for live biz, with a private-equity eye toward building something substantial rather than selling.
An interesting sidebar: Elliot Groffman represents both Diamond and Windish, who are said not to be on the same page at all times regarding their roles in a newly organized Paradigm—which complicates matters somewhat. Are the above agents willing to sign new long-term deals to stay in a new venture as long as the CEO is Wasserman? He seems to have struck up a great deal of support from managers and promoters, the other key parts of the live business.
A 6/4 Variety piece noted that Tom has brought in former Warner/Disney TV exec Bruce Rosenblum as an advisor, though his expertise isn’t particularly relevant to Paradigm’s core music biz.
How will the deal be structured? Stay tuned.
