WILL KWATINETZ AND AZOFF TEAM UP FOR SUPERMANAGEMENT COMPANY?

Jeff Kwatinetz is at it again, and this time he’s dancing with Irving Azoff. Sources inside both companies confirm that talks are ongoing to join their music management companies under one roof.

Plans are for Azoff to head the company, overseeing a combined roster that includes Linkin Park, Korn, Dixie Chicks, Enrique Iglesias, Audioslave, Limp Bizkit, Snoop Dog, Christina Aguilera, Jewel, Van Halen and the Eagles, among others.

The money men were reportedly up in Boston at Thomas H. Lee Partners, trying to hammer out a business model that would give the deal the proper economics. Kwatinetz had previously huddled with Lee and company about acquiring Warner Music Group before Edgar Bronfman Jr. entered the picture. Questioners questioning whether the financiers would entertain the possibility of rolling this new management entity into their reported plans to take WMG public. Kwatinetz also reportedly made a play for MGM’s film library earlier this year, though it ended up going to Sony.

Back in 2000, entertainment moguls Robert Sillerman and Haim Saban separately considered a play to consolidate the music management business, though, as a service industry that doesn’t deal in hard assets, but personalities, it never happened. Sillerman actually acquired 16% of The Firm for a reported $25 million as part of a $200 million deal to acquire the company in Nov. 2000 and fold it into his planned FXM super management entity. He ended up being sued by Kwatinetz for breach of contract and fraud to the tune of $1 billion, when he was forced out of the deal because of his non-compete clause with Clear Channel after selling them SFX. An out-of-court settlement was eventually reached, with Kwatinetz buying back the 16% of the company acquired by Sillerman for substantially less than he sold it for.

At the time, Sillerman was reportedly offering management companies six-to-eight times annual earnings, which was considered high for a service business. The other issue was the personal nature of management, and how binding artists’ contracts would be if their personal service representatives were to leave.

Rumor has it, if the deal happens, Irving will try to bring ex-colleague Howard Kaufman's HK into the fold, with a roster which includes Aerosmith, Jimmy Buffett, Lenny Kravitz, Chris Isaak and Fleetwood Mac, among others? Meanwhile, another possible target is Allen Shapiro’s Mosaic Media Group. In 1999, Shapiro acquired Atlas/Third Rail Management’s Pat Magnarella, Scott Welch and Charles Roven, with an artist roster that included Green Day, Alanis Morissette and Goo Goo Dolls, to his company, which repped Jim Carrey, the Wayans, Jon Stewart and Will Ferrell, among others, at the time.

Kwatinetz originally started The Firm in 1997 after ankling Gallin-Morey and Associates with Mike Green, Peter Katsis, Gayle Boulware, two assistants, Korn and actor Martin Lawrence, in a Malibu condo. Kwatinetz acquired Ovitz’s AMG in May, 2002, adding partners Rick Yorn and Julie Silverman-Yorn, and a client roster that included Cameron Diaz, Samuel L. Jackson, Leonardo DiCaprio, Vin Diesel and Martin Scorsese, among others. He brought on music managers Andy Gould and Rob McDermott (Linkin Park), Simon Renshaw (Dixie Chicks) and Jeff Rabhan (Michelle Branch). The Firm recently added Anastacia, Clay Aiken and Weezer to its roster. Last March, Kwatinetz linked up with ex-Disney TV and Comcast C3 Chairman Rich Frank’s Integrated Entertainment Partners, naming him to the newly created post of The Firm's Chairman.