Saturday, May 2, 2020

#atxcouncil: Austin City Limits...and the Saudi's?!?

"Do not be wise in your own eyes;
Fear the Lord and depart from evil."
Proverbs 3:7

This is pretty crazy:
The Saudi Arabian government now effectively owns a piece of the Austin City Limits Music Festival.

An April 27 filing with the U.S. Securities and Exchange Commission revealed that the government-run Saudi Public Investment Fund purchased a 5.7 percent stake in Beverly Hills, California-based concert giant Live Nation Entertainment Inc. Live Nation owns a majority stake in Austin-based concert promoter C3 Presents LLC, which runs ACL.

Media reports peg the value of the Saudi deal at $500 million. In picking up nearly 12.4 million shares of stock in publicly traded Live Nation, the Saudi fund now ranks as the company’s third largest stockholder.

In 2014, Live Nation bought a 51 percent stake in C3. With that purchase, reportedly valued at $250 million, Live Nation added ACL, Lollapalooza, and other music festivals to its roster.
 (h/t. MediaATX Newsletter...sign up here.)

We need to start this post off with a confession: Last night, when we first saw this story, we thought there were major implications for Texas at a time of low oil prices.  Having had a chance to sleep on it, we don't really think that's the case.  Most of the Texas-specific stuff is tangential and through multiple degrees of separation.  Texas is really only relevant to this story to the degree that Texas is part of the United States.

That being said, the geopolitical and international implications are mind-boggling.  If we were a policy maker at the national level, we would scrutinize that particular Saudi transaction very closely.  But geopolitics is no longer our bag.

However, there is a local angle here.

Every year, the C3 Events LLC gets to put on a for-profit event (ACL fest) using a city owned asset (Zliker Park) without compensating taxpayers.  C3 events LLC then hoards most of the profits.  That's been the case for a long time, and it's always been wrong.

But Saudi involvement takes the level of wrong to a different level.

Wahhabism and all that.

Bottom Line: Private entities shouldn't receive sweetheart deals to use public assets to produce for-profit events.  That's a basic principle and has always been the case.  When the private entities in question suddenly suddenly morph to include Saudi wahhabists, however, it raises the stakes.  C3's longstanding preferential treatment really ought to receive a fresh look.

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