Mohari Hospitality, an investment firm focused on the luxury lifestyle and hospitality sectors, will acquire Tao Group Hospitality, an operator of restaurants, nightlife and entertainment, from Madison Square Garden Entertainment Corp. and other limited partners. The transaction values Tao Group Hospitality at $550 million and is expected to close next month, subject to customary closing conditions.
This acquisition adds to Mohari’s portfolio of assets, but also provides the group with a platform and management team which will accelerate its growth plans and deepen its footprint in leading hospitality destinations, according to the company.
“Tao Group has grown from an innovator in nightlife to a leader in premium lifestyle and hospitality,” said J. Allen Smith, managing partner, Mohari and the former president/CEO, Four Seasons Hotels and Resorts. “Its global footprint of more than 80 branded locations in over 20 markets and best-in-class management infrastructure speaks to the group’s tremendous potential.”
Tao Group will complement Mohari’s existing portfolio of luxury and lifestyle properties and operating companies, including the Peninsula Papagayo in Costa Rica, anchored by a Four Seasons luxury resort; Centro Canalejas Madrid, featuring the Four Seasons Madrid; and The Ritz-Carlton Yacht Collection.
Mohari’s luxury hospitality portfolio aligns with Tao Group’s global collection of brands, including TAO, Hakkasan, OMNIA, Marquee, LAVO, Beauty & Essex and more. Mohari will bring real estate development and hospitality management experience to Tao Group, especially for projects like the recently announced Tao Hotel in Orlando, FL.
“Over the last 20 years, we have been laser-focused on building premium guest experiences and a company with a global influence in all areas of hospitality, entertainment and pop culture,” said Noah Tepperberg, co-CEO, Tao Group. “Mohari’s shared vision, coupled with the strength of its portfolio and leadership, make it an ideal partner as we look at the next chapter for Tao Group. We are excited to build this partnership to scale our companies together.”
With the purchase of MSG Entertainment’s majority interest, as well as the stakes of additional third-party investors, Mohari will own Tao Group together with management, including co-CEOs Tepperberg and Jason Strauss.
“Adding Tao Group to our portfolio is a major strategic milestone for Mohari, and we’re excited about the prospects for the combined business and the transformational potential of our partnership,” said Mark Scheinberg, founder/principal, Mohari. “Noah and Jason have built a world-class and industry-leading organization, and I’m personally thrilled to have their leadership and entrepreneurial spirit joining the Mohari family. The combination of our assets, brands and teams creates a unique global platform to further realize our vision and expand on our ambition in the hospitality space.”
As a part of the transaction, Tao Group will enter into a multi-year agreement with MSG Entertainment for ongoing consulting, marketing and support services at Madison Square Garden and Sphere in Las Vegas.
For Mohari, Moelis & Company LLC served as financial advisors, Kirkland & Ellis LLP served as legal advisors and Deloitte served as accounting and tax advisors.
For Tao Group, Goldman Sachs & Co. LLC served as financial advisor, Hughes Hubbard & Reed LLP served as legal advisor and Ernst & Young LLP served as accounting advisor.