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MSG Serves up Tao Group for $550 Million

Waitress gets a tip.

The hand of the waitress takes the tip. The waiter girl receives a tip from the client at the hotel bar. A bartender woman is happy to receive a tip at work. The concept of service.

Billionaire Mark Scheinberg’s Mohari Hospitality Limited announced its acquisition of nightlife and fine dining staple Tao Group Hospitality in a stock purchase that values Tao at $550 million. Madison Square Garden Entertainment Corp. (MSG) will be selling its 66.9% majority interest with the expectation that the deal with close as soon as next month.

Variety lauds Tao’s venues, stating, “Tao Group has launched clubs, pop-ups and eateries like the eponymous Tao, the Michelin Star-awarded Hakkasan, Omnia, Marquee, Lavo and Beauty & Essex in multiple cities across the U.S. and internationally. The locations have been heavily favored by celebrities, media powerbrokers, sports stars and other gliteratti for over two decades.”

Madison Square Garden had purchased its stake in 2017 and since then, “Tao Group Hospitality has transformed into a global powerhouse in entertainment dining and hospitality, with a portfolio of over 80 branded locations in over 20 markets across four continents,” according to the companies’ joint press release. That period has been a historically tumultuous time for the broader bar and nightclub industry.

Bars & Nightclubs in the US


The industry took a huge hit during the pandemic as lockdowns and fears of contagion kept customers away from in-person gatherings. Even after they were permitted to reopen, bars were cited for fueling outbreaks. Many venues closed, with the industry’s market size crashing during 2020. But patrons returned quickly during 2021 and sales eclipsed2019’s record highs by 2022.

Just as patrons were returning, restaurants faced employee shortages as the “great resignation” of 2021-2022 led many to quit their jobs across a variety of industries; however, despite this trend, bar and nightclub industry employment surged during the period. The industry currently has nearly 600,000 employees, which represents an 8.4% annualized employment growth rate since 2018.

U.S. Bars & Nightclub Employment


As demand for employees surged, so did wages. Following the large dip in 2020, industry wages hit record highs as early as 2021 and reached a new record in 2022, representing at 4.3% annualized growth during 2018-2023.

U.S. Bars & Nightclub Wages


According to Matterhorn’s comprehensive M&A database, which harnesses AI to track current and historical deals, Madison Square Garden and Tao are represented by law firms, Shearman & Sterling LLP and Kirkland & Ellis LLP Nixon Peabody LLP and financial adviser Goldman Sachs & Co. LLC. Mohari Hospitality is represented by Hughes Hubbard & Reed LLP and financial adviser Moelis & Company LLC.

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