Madison Square Garden Entertainment To Sell Tao Group Stake for $300 Million

Madison Square Garden Entertainment (MSGE) has reached an agreement to sell its stake in the Tao Group chain of restaurants and nightclubs to global luxury lifestyle company Mohari Hospitality, according to a filing Monday (April 17).

MSGE will sell its 66.9% majority interest in Tao Group Hospitality for about $300 million, according to the filing. The deal, which values Tao Group at $550 million, is expected to close in May.

News of the planned sale comes just days before MSGE is expected to finalize the spin-off of its live entertainment business, a move that will separate the pure-play live music business from the company’s state-of-the-art Sphere venue in Las Vegas, sports television network and hospitality businesses.

The spin-off would have moved Tao Group Hospitality into the parent company, renamed Sphere Entertainment Co., along with the Sphere, the new Las Vegas venue currently under construction, and MSG Networks. The company said Monday that upon the deal’s close, it will “enter into multi-year agreements with Tao Group Hospitality for ongoing consulting, marketing, and support services at Madison Square Garden and Sphere in Las Vegas.”

MSGE bought a majority stake in Tao Group in 2017 and has since expanded it to include Hakkasan, Beauty & Essex and other restaurants for a total of more than 80 locations spread across 24 cities on four continents.

Founded in 2017, Mohari Hospitality is an investment company that owns stakes in the Waldorf Astoria in Miami, the 1 Hotel in Toronto, a luxury sustainability-focused resort in Costa Rica called the Peninsula Papagayo and the Ritz Carlton’s cruise line of custom yachts.

Equity holders in Tao Group Hospitality were advised by Goldman Sachs & Co. and Hughes Hubbard & Reed. Advising Mohari Hospitality were Moelis & Company and Kirkland & Ellis.