Roll-Up Playbook: Theatres
I recently attended a Broadway musical with a cousin visiting from out of town. The show was fantastic and surprisingly packed for a Wednesday afternoon. It got me wondering…
State of Play
In January 2025, ATG Entertainment (“ATG”)—a global theatre platform backed by Providence Equity—announced its acquisition of SOM Produce, a Spanish theatre operator and producer with 5 venues in Madrid.
Madrid ranks as the third-largest theatre market, behind Broadway (New York) and the West End (London). This deal continues ATG’s M&A-fueled expansion, growing its portfolio from 40 venues in 2013 (when Providence acquired it) to 73 venues today.
How ATG Makes Money
Before diving into ATG’s investment thesis, here’s a breakdown of its three vertically integrated business lines:
🏟️ 1. Theatre Venues (ATG Venues)
ATG generates revenue from its venues through:
Venue rental fees – Typically a weekly flat fee + a percentage of box office revenue
Concessions – Food, beverages (especially alcohol)
Merchandise – Show-related memorabilia like clothing, posters, and souvenirs
Advertising – Brand sponsorships and local business promotions
Memberships – Subscriptions offering perks like free drinks and discounted tickets
Some theaters outsource concessions and merchandise to third-party operators, effectively acting as landlords collecting rent and fees.
🎥 2. Musical Production (ATG & Sonia Friedman Productions)
For its in-house productions, ATG earns revenue from:
Ticket sales – The primary revenue driver
Licensing – Granting performance rights to other venues or formats
Albums & streaming – Royalties from show music, primarily on streaming platforms
🎟️ 3. Ticket Sales (ATGtickets.com, Groupline, LOVEtheatre)
ATG’s ticketing business monetizes through:
Ticketing fees – Service and processing fees charged to consumers
Advertising – Digital ads on ticketing websites and apps