Live Nation Entertainment revealed this week that it has officially pulled out of an agreed acquisition deal for a majority stake in the leading Latin American music promoter, OCESA. Now, the Mexico-based company is considering legal action.

Originally, Live Nation was set to acquire a 51% stake in OCESA for a purchase price of MXN $4.835 billion ($462 million USD). OCESA, which is the owner of Ticketmsater Mexico from CIE as well as Grupo Televisa, is the largest multimedia company within the Spanish-speaking world.

After an initial hold-up, the buyout was approved in April. However, this week, news broke that Live Nation would be terminating the purchase agreement.

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“Live Nation had entered discussions with CIE and TV regarding potential modifications to the timing and terms of the acquisition, but the parties have been unable to agree on modified terms,” an SEC filing notes.

The entertainment giant’s President and CEO Michael Rapino said on an investor earnings call that the promoter giant was looking to delay payment for the deal amid the coronavirus pandemic. He said that while they “want to be in business with OCESA and get the deal done,” however, “I’m not looking to take on any losses from Mexico while they’re going through their six or eight months of business downturn” due to the global crisis.

Live Nation released a statement this week, noting that they had notified CIE of the termination “as a result of CIE’s failure to comply with its contractual obligation to continue operating the Target Companies in the ordinary course of business.”

“Live Nation anticipates that CIE will defend these arbitration proceedings and that both CIE and TV may pursue any legal remedies available to them to enforce the terms of their respective Purchase Agreements and contest the validity of their termination,” the statement continued.

The Mexican firm told Reuters in a statement that they had opposed the decision and both parties began to talk under a so-called “suspension agreement,” which expired following no resolution.  CIE said it would analyze its legal options.

Earlier this month, Live Nation revealed that the company intended to secure $800 million in senior date via a secured note sale, with repayment due in 2027. The debt was later increased to $1.2 billion, with senior secured notes due in 2027 with an annual interest rate of 6.5% per annum. The sale is set to close May 20.

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