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Madison Square Garden buys 62.5% stake in restaurant, nightlife group

Madison Square Garden Co. purchased a 62.5% common equity stake in a newly formed TAO Group for $181 million, plus a potential performance earn-out of up to $25.5 million.

TAO Group's management team that includes founders Marc Packer, Rich Wolf, Noah Tepperberg and Jason Strauss retains the remaining 37.5% interest in the newly formed TAO Group and will continue to run the day-to-day operations of the business, the company said Feb. 1.

TAO Group operates 19 entertainment dining and nightlife venues in New York City, Las Vegas and Sydney, with brands like Tao, Marquee, Lavo, Avenue, The Stanton Social, Beauty & Essex and Vandal. Further, Madison Square Garden and TAO Group will work to create new premium hospitality experiences that can be integrated across the company's portfolio of live offerings.

Separately, Madison Square Garden also plans to enter into a Rule 10b5-1 stock repurchase plan. The plan will let the company effect additional stock repurchases under its existing stock repurchase authorization, including during periods when the company might otherwise be prevented from making open market purchases.

For MSG, Goldman Sachs & Co. served as the financial adviser and Hughes Hubbard & Reed LLP as legal counsel. Moelis & Co. acted as the financial adviser to TAO Group, and Paul Weiss Rifkind Wharton & Garrison LLP as legal counsel.