Blackstone, one of the world’s biggest private equity firms, is in advanced talks to buy a stake in Ambassador Theatre Group (ATG), the owner of some of the most famous playhouses in London’s west end.

Sky News has learnt that Blackstone, which manages more than $1trn in assets, is close to snapping up a minority interest in the owner of the Duke of York’s and Lyceum theatres.

If completed, it will be a significant corporate transaction for a company which has staged productions of Harry Potter and the Cursed Child, Hamilton and The Book of Mormon.

City sources said that Blackstone was expected to acquire the shareholding from TEG, an Australian live entertainment and ticketing company which bought into ATG during the pandemic.

One added that the deal would involve a stake of between 10% and 15% changing hands.

ATG has been majority-owned by Providence Equity Partners since 2013, making it a lengthy ownership period by private equity industry standards.

Providence did consider running a sale process several years ago but was stymied by the pandemic, which forced the closure of theatres and other live entertainment venues for months during a succession of lockdowns.

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ATG operates dozens of theatres in the UK, with its other prominent venues including the Harold Pinter Theatre, as well as the Empire in Liverpool and the Lyric and Hudson on Manhattan’s Broadway.

In total, it owns roughly 60 theatres, having struck a deal in 2021 to buy the Golden Gate Theatre and Orpheum Theatre in San Francisco, and the Fisher Theatre in Detroit – both of which are key cities for touring Broadway productions.

Last year, it announced that it was combining its US operations with Jujamcyn Theaters to strengthen its position in that market.

The company competes with rivals including Lord Lloyd Webber’s Really Useful Group and the billionaire Sir Leonard Blavatnik, who owns the Theatre Royal Haymarket.

The valuation of ATG in the deal with Blackstone was unclear this weekend.

Providence acquired the company for £350m over a decade ago.

In 2022, it was reported to be seeking to refinance roughly £1.2bn of debt.

ATG has a workforce of more than 4,000 full-time equivalent employees, and its venues have played host to some of the world’s most successful plays and musicals, including The Lion King, Les Miserables and Wicked.

The company was founded in the 1990s by the husband-and-wife team Sir Howard Panter and Dame Rosemary Squire, who subsequently went on to set up a rival theatrical group.

It is now run by Ted Stimpson, a leisure industry veteran who replaced Mark Cornell last year.

A renewed sale process for ATG is said to be unlikely to take place for some time.

Accounts for International Entertainment Holdings, ATG’s parent company, show it made a record operating profit in the year to 25 March 2023 of £120.5m.

It said that advance ticket sales were exceeding pre-COVID levels.

Blackstone and Providence both declined to comment.

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