Top Investor Wants Grand Ole Opry Spun Off From Gaylord
Back on April 30th, Saving Country Music asserted that The Grand Ole Opry was ripe to be spun off and sold from its parent company of Gaylord Entertainment, to the humor of many. Then a month later, lo and behold, Gaylord and The Grand Ole Opry were officially sold to Marriott for $210 million. But apparently the two top shareholders in Gaylord are unhappy with the Marriott deal, with the first one having to be bought out, and the second one Gabelli Funds LLC with a 15% percent stake in Gaylord, specifically asking Gaylord to spin off its Grand Ole Opry assets for the exact reasons Saving Country Music has asserted it should.
As Reuters reports, Gabelli’s concern is that with Gaylord transforming from a broadcasting and entertainment company to a real estate holdings company, Gaylord management will be unable to deal with the specific needs of The Grand Ole Opry. Gabelli said to a letter to Gaylord that under the Marriott deal, The Grand Ole Opry would suffocate and be neglected, but if it was spun off…
…with dedicated and focused management, Opry should better flourish and be an enormous success for shareholders.
Over the last 15 years, Gaylord Entertainment has dramatically shifted their business model from a broadcast and entertainment company, to a hospitality resort-holdings, real estate-based model. Gaylord used to own over 10 local television stations, as well as CMT, TNN, WKY Radio in Oklahoma City, The Daily Oklahoman newspaper, and the massive Acuff-Rose music publishing firm (now Sony ATV). All of these have now been sold off, with The Opry’s WSM the only remaining broadcasting arm of the business.
Today Gaylord’s core business is its 5 resorts and convention centers in Nashville, Orlando, Grapevine, TX (Dallas), National Harbor, MD, and Denver (scheduled to open 2014), as well as other real estate assets. If you take away the real estate and tourist component from The Grand Ole Opry, the Opry franchise sticks out like a sore thumb in the current Gaylord Entertainment business structure.
As part of the sale to Marriott, Gaylord wants to officially restructure into an REIT, or Real Estate Investment Trust, to unlock certain tax incentives, but both Gabelli, and the previous #1 investor in Gaylord, TRT Holdings, think that Gaylord negotiated a bad deal, and that restructuring into an REIT is a bad idea, especially because of Gaylord’s Grand Ole Opry assets. To satiate TRT holds, which owed a 21% stake in the company, Gaylord bought back 5 million of its shares for $185 million in July, making Gabelli now Gaylord’s #1 investor. Now that Gabelli is opposing the deal, and specifically because includes the Grand Ole Opry asset, the possibly the Grand Ole Opry will be spun off from Gaylord has never been greater.
The sale of Gaylord to Marriott comes up for a shareholder vote this week, where the fate of Gaylord’s future as an REIT and the status of The Grand Ole Opry will be big topics.
Why Is It Important Who Owns The Grand Ole Opry?
As Gabelli explains, if the Grand Ole Opry is buried in a corporate structure managed by people that are not aware or not used to managing a historic institution like the Opry, the likelihood is that it will not reach it’s fullest potential, as an institution or as an investment. If The Opry assets were either owned autonomously (if The Opry owned itself), or by another company that is better suited to understanding the specific needs of the Opry, it is more likely to earn a greater return for investors.
Hypothetically this would also be a better outcome for country music fans who have been frustrated by the current management and direction of The Opry. As it stands, many Opry decision are run through a corporate structure designed to manage hotels and real estate, not stage performers and country music personalities. Hypothetically, Gaylord coming under the Marriott umbrella would only make this worse, and The Opry being spun off could only make it better.
September 17, 2012 @ 11:59 am
Lord I hope this leads to some changes. If the Opry went country again I’d drive out there tonight!
chris lewis "louie"
September 17, 2012 @ 12:07 pm
I would like to see it become an institution owned by those from the Hall of Fame, but fear it would end up being owned by some horrible music row machine..ie Scott Borchetta or Viacom.
September 17, 2012 @ 12:58 pm
I would love to see the whole letter from Gabelli’s to Gaylord, but what they seem to be alluding to is that The Grand Ole Opry would flourish the best owning itself, and this means a lot coming from the the entity that has the biggest vote in a Gaylord shareholder meeting. Big Machine and Viacom may be more suitable owners than Marriott, but I don’t think anyone is perfectly suited to own the Opry, except for maybe the Country Hall of Fame, but I admit that is close to an impossibility. Gabelli also talked about keeping it a publicly-traded company, which kind of takes the HOF out of the running (though they’re not really in it from my knowledge).
I’d really like to see an assessment of how much The Opry unit is valued at. That may be the first key to figuring out who could be in a position to buy it.
The reason I’ve been following this story so closely is because I think there is no bigger issue facing country music right now, and though in the end you and I and the average country music fan will have little say so, I think it is important to stay engaged in the discussion. In my opinion, it is the fans of country music that should have true ownership of The Opry. Their input and the future of the institution will hopefully have some consideration in the process.
September 17, 2012 @ 12:31 pm
This could be a huge shift in how commercial it has been but I’m not getting my hopes up. I really hope it all changes to represent real artists.
Tom the Pollack
September 18, 2012 @ 6:46 am
Yeah…. There’s always a hope, but personally I don’t believe that the grand ole opry will be Grand again after so many years of promoting pseudo – country music. Bussinesmen has never been good. I don’t live in USA, (just look at my nickname) but I love real american country music and I’m interested in that topic very much. I predict that the real country music like Hank 3, Lucky Tubb, Bob Wayne, James Hand, Ray Lawrence Jr., Dale Watson and other great stuff will always be kinda underground and will never get too much media coverage. Just look back at the history of Nashville music industry – the case of Hank Sr. (everybody knows what I’m talking about), the story of D.A.C. who was black – balled in Nashville for his “strange” physical appearance. For me D.A.C. is one of the most underrated country singers – despite his huge number of fans, the business has never liked him. The real country music will never die, but whatever happens the most propable thing is that Nashville will remain Trashville. Considering what great artist perform at the Muddy Roots Festival ( I dream of seeing it alive someday) I think that such events are definitely much more interesting than most of the perforfmances at the “grand” ole opry.
Sorry for any possible mistakes ( I’m just a dumb pollack) Greetings.
September 18, 2012 @ 10:31 pm
I appreciate your sentiments, and you’re right, a lot of the music we love will likely stay underground, some of it by choice.
But who will fight for The Grand Ole Opry if we don’t? How will folks even know if there’s a problem or opposition if we don’t raise our voices? You may be right, the Grand Ole Opry may never be grand again, but it certainly won’t be unless someone tries, unless we fight for it, unless we stay informed, engaged, and active. There is no more important institution to the formation of American country music than the Grand Ole Opry; to this there is no debate. And so I am not willing to give it to them. It’s not theirs, it’s ours; it belongs to the people of country music, not any business or institution.
As for David Allan Coe, this is a topic that comes up often. I am a HUGE David Allan Coe fan and have been for many years. But it is a little revisionist history to say that he was “screwed” by Nashville and that’s all there is to it. DAC is a racist, sexist, foul-mouth pig who murdered a man and has done many other atrocious things, and written/recorded some atrocious songs. I love much of the man’s music, but he’s a rough character, not just from appearance, and if it is not obvious to you why the country music establishment, or anyone for that matter wants to distance from David Allan Coe, then you need to dig deeper into his back story. DAC made his own bed, he’s bad mouthed Waylon, Willie, many other country legends, and you should see the quote from him about Hank3.
Has David Allan Coe gotten a raw deal? Of course. But many of his own actions didn’t help. I understand you’re a fan and you want to see him get his due. But to do that, you have to be honest about who he is.
Tom the Pollack
September 20, 2012 @ 8:04 am
Everyone knows about DAC’s criminal past – in fact he was raised by various correctional institutes which obviously made him what he is – but he served his time in prison, and no offence, but you’re trying to be a judge and a self – righteous citizen. Look at Johnny Cash who never despised the prisoners and always tried to understand them somehow. Yeah, DAC killed a man. According to him – it was an act of self – defence. In fact, nobody knows the truth how it was. Atrocious songs? Racist? Sexist? The “Underground Album” and “Nothing Sacred” were released as the joke albums. Yeah David has weird sence of humour and some of those songs can be or at least some years ago could be controversial but they have never been performed by DAC alive, and according to his website you can’t buy them in any shop except this website. What’s more, they were marked as the albums which are not recommended for air – play. The rest of his albums are totally different.
You have written: “he”™s bad mouthed Waylon, Willie, many other country legends, and you should see the quote from him about Hank3” – I don’t know anything about that – maybe provide me with some quotations it has always seemed obvious to me that he always had great respect for Willie and Waylon and he is one of the biggest’s Hank 3’s idols (look at the songs like “Thrown out of the the bar” or “Country heroes” still performed by Hank). Maybe I’m unaware, but some quotations would support your words.
On the other side, look at Johnny Paycheck ( I like his music too) who was a full member in the grand ole opry for many years, be he spent some time in two prisons. First time, during his military service for hitting a higher – rank officer and second time for killing a man – probably in self – defence. It wasn’t a problem for Nashville’s businessmen to make him a star. For me that’s an obvious absurd. THINK ABOUT THAT.
September 18, 2012 @ 8:39 am
Pete Fisher the manger of the Opry once said he wanted to get rid of both the gray hair on stage and the ones in the audience. He is doing that. so who ever owns needs to get rid of him.
September 18, 2012 @ 11:32 am
“Gaylord” is a terrible name for anything … especially anything associated with country music.
TX Music Jim
September 19, 2012 @ 3:17 pm
I’ve been to the Opry one time, some 20 years ago. That night was good Diamond Rio who were popular then were on the show lots of legends like Tammy Wynette performed that night. Nowadays when I stop by on GAC or try to listen on SIRRUS you get the laundry list of todays psuedo country “stars”. With the ocasional bone thrown do a true country great.Once in a blue moon you’ll get a Dale Watson if your lucky. We will see. If it stays corporate forget about it more of the same. They best hope is the long shot of the Hall of Fame somehow getting it.
September 21, 2012 @ 9:42 pm
Gaylord have been the worst thing that ever happened to the Opry. Over the years back stage I’ve watched the friendly, family atmosphere dwindle down to nothing. No more harmonizing in the dressing rooms or get togethers in the room where they used to serve lemonade and Grandpa and Bill Carlisle would sit out there and visit with folks. They need to get rid of the current manager for sure. Get someone in there who respects the history of our music rather than worships the Gaylord rhetoric.
September 24, 2012 @ 9:01 am
Well said and I couldn’t have said better myself!