The Madison Square Garden Co (NASDAQ:MSG) announced today that its board of directors is considering separating the company’s live entertainment business from its sports and media businesses. If the board decides to pursue the plan, it would create two separate public companies.

Madison Square Garden explores a split

If Madison Square Garden does complete the spinoff, it will be structured like a tax-free pro rata spinoff to all of the company’s shareholders. After the transaction is complete, shareholders of the original company will own shares in both of the two new companies.

The Madison Square Garden Co Considers Spinoff

According to the press release, the company’s board has been considering whether to pursue the possibility of a separation since July. The goal is to benefit both of the two companies so that they can each have their balance sheet, capital structure and capital return policy.

How Madison Square Garden would split

If the transaction moves forward, the live entertainment company would include the booking and productions businesses, which includes the Radio City Christmas Spectacular featuring the Rockettes. Also the New York Spring Spectacular will be included in the business. The show will debut in the spring. The live entertainment company would also include the venue management business, the company’s sponsorship, marketing, ticketing and promotional platforms and strategic entertainment joint ventures.

The sports and media company would include Madison Square Garden’s professional sports franchises, the New York Knicks, the New York Rangers and the New York Liberty. The company will also include the sports development teams, which are the Hartford Wolf Pack and the Westchester Knicks. The regional sports networks, MSG Network ad MSG+, and the company’s interest in SiTV Media Inc. will also be part of the sports and media company.

Other news from Madison Square Garden

This morning the company also announced that its board authorized $500 million worth of share repurchases. As of Oct. 24, Madison Square Garden had nearly 64 million Class A common shares outstanding.

In addition, the company also revealed its director nominations, which include Trian Fund Management’s Nelson Peltz and Scott Sperling. They will replace Vincent Tese and Alan Schwartz.