Two nightlife groups unite and create a competitive hospitality group
It’s never written in the legal fine print, but some mergers and acquisitions can be boiled down to a simple phrase: the enemy of my enemy is my friend.
Nor does the fine print ever read “survival of the fittest,” but in Las Vegas, the union of longtime operators and one-time competitors Tao Group and Hakkasan Group positions the newly-formed supergroup – dubbed Tao Group Hospitality — as the dominant player on the Strip, just as a new entrant is set to debut on the resort corridor’s north end.
Prior to the merger, both brands saw little overlap in markets outside of Las Vegas, with Hakkasan dominating in London, Los Cabos, and San Diego, among others; and Tao operating multiple venues in Singapore, Los Angeles, and, especially, New York.
Post-merger, Tao Group Hospitality boasts 61 dining and nightlife destinations worldwide – 14 of them in Las Vegas, including the prized Hakkasan Nightclub, OMNIA Las Vegas, Tao Nightclub, Marquee, and JEWEL Nightclub, along with multiple restaurants – Lavo, Searsucker, and Hakkasan’s namesake eatery, to name a few — that will no doubt foster guest loyalty and curiosity in the days and evenings before sending them off to the clubs in the late night hours.
Battle of the Vegas Nightlife Brands
Tao first arrived in Las Vegas in the mid-aughts, bringing the vibe of its New York venue to The Venetian with Tao Nightclub, Tao Restaurant, and one of the city’s earliest dayclub experiences, Tao Beach. But the brand was overshadowed when Hakkasan Group took over Angel Management Group in 2014, introducing the mega-club concept to Las Vegas’ nightlife scene and loading up on high-priced DJ talent to deliver high-powered entertainment to the masses.
The two were able to co-exist, alongside fellow competitors Wynn Nightlife and Drai’s Group, for years, until the pandemic upended the industry, silencing air horns and putting the cap on champagne sprays that were a fixture of the club scene.
It’s anyone’s guess what the return of nightlife in Las Vegas – the city is moving toward a full reopening on June 1 – will look like, but the merger gives Tao Group Hospitality more control over the outcome, largely because it now commands the most real estate on the Strip. MGM Grand, Venetian, ARIA, Caesars Palace, and The Cosmopolitan of Las Vegas are now Tao Hospitality Group destinations; not to mention the in-progress MSG Sphere that is scheduled to come on line in 2023. MSG Entertainment owns a controlling interest in Tao Group Hospitality and will no doubt be tapping the brand’s talent base to fill the arena’s 17,500 seats.
Expanding the company’s customer base and access to capital will be essential as Tao Group Hospitality competes with the newest arrival on the city’s nightlife scene: Singapore-based Zouk Group, which will open its first Vegas venues, Zouk Nightclub and Ayu Dayclub, at Resorts World Las Vegas this summer.
The Fight for Nightlife’s Future
Though an untested brand on the Strip, Zouk has already announced its presence with authority, siphoning star DJs Tiësto and Zedd from the Hakkasan talent roster. Those defections are likely not the last, as Zouk, bolstered by the deep pockets of Resorts World owner Genting Group, looks to grab the global spotlight ahead of the property’s June debut.
Meanwhile, Wynn Nightlife rounds out its 2021 roster with a torrent of big name signings, including Diplo, David Guetta, Shaquille O’Neal, Kygo, and The Chainsmokers.
In its pre-pandemic heyday, Tao built a reputation for mixing live hip-hop acts – artists such as Gucci Mane and Juicy J – with a stable of up-and-coming DJ talent that would split duties between the Venetian club and The Cosmopolitan’s Marquee. Hakkasan had relied on globally recognized DJs — Calvin Harris, Steve Aoki, and the aforementioned Tiësto and Zedd – to draw crowds to its clubs.
With the merger complete, Tao Group Hospitality has the resources to compete with Zouk and Wynn for high-priced talent at its premier clubs, while also having the ability to experiment with lesser-known, on-the-cusp artists, genres, and live performances at smaller venues; knowing that it can sacrifice some revenue for reputation and brand-building because those losses will be recouped at the larger clubs.
We’ll know soon what Tao plans to do with its newly-acquired venues. Neither Tao nor Hakkasan has announced its 2021 talent roster – no doubt the merger needed to be the first headline – and we shall see which names are set to appear, and which, if any, are following Tiësto and Zedd up to Resorts World.
Tao’s mission remains the same: win the nightlife game, at all costs. To do so, it is embracing the “enemy of my enemy” concept before a larger competitor could muscle it off the board.