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Madison Square Garden Co. Board Votes to Split Entertainment, Sports Divisions

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Madison Square Garden Co. announced Thursday that its entertainment operations will be spun off from its sports division, per Kimberly Chin of the Wall Street Journal

The New York Knicks and New York Rangers, who both call the Garden home, headline the sports operation.

“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,” MSG said in a statement.

Nick Turner and Eben Novy-Williams of Bloomberg also provided reasoning for the move, which is expected to become official in the first quarter of the 2020 fiscal year.

“The idea is to unlock value by separating the assets,” Turner and Novy-Williams wrote. “The Knicks and Rangers are worth a combined $7.2 billion, according to Blue Harbour Group, which owns a 4 percent stake in MSG. That’s 10 percent higher than the market value of MSG as a whole.”

The separation does not mean that James Dolan will sell the Knicks and Rangers, with Bloomberg elaborating further.

“MSG announced last year that it planned to spin off its pro sports franchises,” Turner and Novy-Williams wrote. “Rumors have circulated for years that the Dolan family might sell one or all of the teams. Jim Dolan has repeatedly said that while he has an obligation to consider offers, he isn’t interested.”

Per Chin, MSG Co.’s shares rose 3.7 percent in after-hours trading following the announcement.

Article source: https://bleacherreport.com/articles/2861435-madison-square-garden-co-board-votes-to-split-entertainment-sports-divisions

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