Live Nation Entertainment has completed a deal to acquire a majority stake in Knoxville, Tenn.-based independent promoter AC Entertainment, co-founder (with Superfly) of the Bonnaroo Music & Arts Festival in Manchester, Tenn., Billboard has learned.

Founded 25 years ago by CEO Ashley Capps, AC Entertainment is a promotion, production, booking and marketing that presents and produces concerts and festivals, along with club and theater booking, management, event marketing, and sponsorship services.

Last year, Live Nation acquired a majority stake in Bonnaroo but did not expand the deal to include the festival's producers. Acquiring AC Entertainment gives Live Nation a presence in more markets across the Southeast and will foster growth opportunities for founder/CEO Ashley Capps and his team. "As the saying goes, the only constant is change, and embracing change and pursuing new opportunities have defined AC Entertainment throughout its 25 years," Capps tells Billboard.

"Initially, the conversation with Live Nation was one of several that we were having as we contemplated how we wanted to grow and where we wanted to go as a company in the coming years," Capps continues. "As we got to know the Live Nation team better, especially working on Bonnaroo, it became clear that our teams could complement one another very well. It seemed like a great fit for AC, for where we are as a company now and how we expect to grow in the future."

AC Entertainment co-founded Bonnaroo in 2002, and the company continues to co-produce it and maintain the Great State Park, where the iconic festival takes place. AC's portfolio also currently includes Forecastle in Louisville, Ky., Big Ears in Knoville, and Sloss Music and Arts in Birmingham, Ala. Focused on the Southeastern U.S., AC Entertainment is responsible for more than 1,000 shows per year, and also has venue deals in place for such sites as the Tennessee Theatre and Bijou Theatre in Knoxville, and the Tivoli Theatre, Soldiers and Sailors Memorial Auditorium in Chattanooga.

Capps will still manage the day-to-day operations of the company, which will continue to operate under the AC Entertainment banner. AC employs 40 full time staff in Knoxville (including its venue management team that runs the Tennessee Theatre, the Bijou Theatre, and the new Mill & Mine), with nine full time staff in its Nashville office, seven full time staff in its Chattanooga office (running the Tivoli Theatre and Memorial Auditorium there). AC also has satellite offices in Louisville and Chicago. No staffing changes related to the Live Nation agreement are planned.

"Relationships are key to success in our business, and we plan to continue to operate as we do now," says Capps. "Of course, we didn't do this deal to continue 'business as usual,' but the plan is smart growth from the core business platforms that we have in place. We'll be able to do more, to be more effective, with the access to the extraordinary relationships, expertise, and resources that Live Nation brings to the table."

For Live Nation, the move gives the company a strong presence in Knoxville and Chattanooga, where it doesn't currently have staff on the ground, and an increased presence across the Southeast, particularly in secondary and tertiary markets where AC has been active and experienced growth over the past few years.

"We're at an exciting place -- with a variety of new projects on the drawing board," Capps says. "This new strategic alignment is the next logical step for us in our evolution as a company."