Exhibit 99.1
THE MADISON SQUARE GARDEN COMPANY PROVIDES UPDATE ON
POTENTIALSPIN-OFF TRANSACTION
Company Now Pursuing FullSpin-off of Entertainment Businesses from Sports Businesses
Proposed Transaction Still Expected to be Completed During the First Quarter of Calendar 2020
NEW YORK, NY – November 7, 2019 – The Madison Square Garden Company (NYSE: MSG) today announced that its board of directors has unanimously approved pursuing a revised plan for the proposed separation of its sports and entertainment businesses. The Company is now pursuing aspin-off of its entertainment businesses into a separately traded public company and, as part of this revised structure, the entertainment company would not retain an equity interest in the sports company. The proposed transaction is still expected to be completed during the first quarter of calendar 2020, subject to certain conditions.
The Company had previously been exploring a plan tospin-off approximatelytwo-thirds of its economic interest in its sport businesses to shareholders, with the entertainment company retaining an approximateone-third interest in the sports company.
The newly revised transaction would be structured as atax-free pro rataspin-off to all MSG shareholders. Each shareholder would continue to own their current economic interest in both the sports and entertainment businesses. The Company continues to believe that the proposed separation of the sports and entertainment businesses would enable shareholders to more clearly evaluate each company’s assets and future prospects, while allowing each company to have a capital structure and capital allocation policy most appropriate for its business.
Executive Chairman and CEO James L. Dolan said, “Thespin-off would create two distinct companies for MSG shareholders, each with a defined business focus and clear investment characteristics. One company would be a leader in live entertainment that would take advantage of significant opportunities to grow rapidly within the changing entertainment landscape. The other entity would be a sports company with marquee assets that would enjoy steady growth and strong free cash flow.”
The pure-play sports company would reflect the strong and steady financial performance of MSG’s sports businesses driven by the Knicks and Rangers franchises, while the entertainment company would capitalize on opportunities for growth, most notably through venue expansion as the Company moves forward with its MSG Sphere initiative.
MSG has made significant progress on its first MSG Sphere in Las Vegas with the goal of opening the venue in calendar 2021. For its second MSG Sphere in London, the Company is continuing to move through the planning application process, which is now expected to run into calendar 2020. The Company also remains focused on incorporating learnings from its Las Vegas project in London. For these reasons, it is no longer possible for the London venue opening to be one year after the opening of MSG Sphere in Las Vegas. As a result of the evolving timeline in London, the Company now believes the standalone entertainment company would have sufficient financial flexibility to pursue its venue expansion plans without the need for the retained equity interest in the sports company. In addition, the revised structure would eliminate any potential tax leakage associated with the sale of the retained interest in the Sports company.
The pure-play sports company would include:
| | • | | The New York Knicks professional NBA franchise and its development team, the Westchester Knicks; |
| | • | | The New York Rangers professional NHL franchise and its development team, the Hartford Wolf Pack; |
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