N.Y. Orchestra, Carnegie Hall Cancel Merger

The remarriage of the nation’s oldest symphony orchestra, the New York Philharmonic, and its best-known concert venue, Carnegie Hall, is off.

The two institutions announced Tuesday that they had “each unanimously agreed to end discussions toward a merger,” meaning that the Philharmonic will remain in its home of the last 41 years, Lincoln Center.

“It has become apparent that the mission, size and scope of each institution are too significant to be fully integrated into one entity,” the boards of the two cultural powerhouses said in a joint statement, just four months after they had touted the benefits of the 161-year-old orchestra’s returning to Carnegie Hall. The orchestra was one of its original tenants in 1891 and played for seven decades -- before leaving in 1962 to become a founding tenant of Lincoln Center.

“It’s the greatest hall in the world,” said Zarin Mehta, the orchestra’s executive director, when the plan to return to Carnegie Hall was announced in June. “Everybody drools at the thought of playing there.”

Although Philharmonic musicians did gush over the Carnegie acoustics, officials of the orchestra reportedly began to have second thoughts about the potential downside of becoming a full financial partner in the merged entity, and not merely a tenant.

The practical issues were numerous: from finding room on the Carnegie Hall calendar for the 120 to 130 concert dates demanded by the Philharmonic to reconciling the institutions’ differing pension plans. The two risked losing not only their distinct identities with the merger but also donations from wealthy benefactors who give to both. And they faced the challenge of combining a board of directors with 60 members (Carnegie Hall’s) with one that has 40 (the Philharmonic’s).

“We gave the possibility of a merger our best efforts,” said Sanford I. Weill, chairman of Carnegie Hall and a veteran of more successful mergers in the private sector as chairman of Citigroup.

The one apparent winner Tuesday was Lincoln Center, whose officials had admitted being stunned in the spring when the Philharmonic announced its intention to leave the center’s Avery Fisher Hall. The orchestra had long complained of poor sound there, and plans to essentially rebuild the hall had fallen through at a time when many cultural institutions were running deficits. But Lincoln Center had been discussing less costly ways to improve its symphony hall.

When the Philharmonic said it would be heading back to Carnegie Hall, beginning in the 2006-2007 season, Lincoln Center officials tried to put the best face on the snub by announcing that they would use their concert space for longer runs by visiting orchestras and for more “thematic programming,” such as the Great Performers series.

On Tuesday, Lincoln Center officials tried not to gloat over the Philharmonic’s remaining in the fold. A statement from the center’s chairman, Bruce Crawford, and its president, Reynold Levy, said they were “pleased” that the Philharmonic “has now notified us of its intent to remain here” and they “look forward to strengthening the future working relationship.”

The breakdown of the merger between the Philharmonic and Carnegie Hall did not surprise a leading expert in the economics of performing arts institutions, New York- and London-based consultant Adrian Ellis.

“It was too unwieldy,” Ellis said. “I thought it was bonkers when it was announced. What was to be gained? If they wanted to have a residency [at Carnegie Hall], why not just have a residency? Mergers are hell in the nonprofit world. They often end in tears ... when you think of all the politics and all the issues.”

Ellis cited such difficulties as combining the endowments of two such institutions and deciding which of the chief executives would be in charge.

“Often relatively trivial things can trip them up, like agreeing on a name ... or which board members stay,” he said.

With the Philharmonic’s reunion with Carnegie Hall scuttled, Ellis added, “the real issue is whether they can patch up their relationship with their old girlfriend,” Lincoln Center.

The last few months seem to have left a residue of ill will on several fronts. For one thing, Lincoln Center’s anger at the Philharmonic’s announced departure manifested itself in talk of legal action if the orchestra did not fulfill its obligations as a tenant under its “constituency agreement.” Now, although Lincoln Center is raising money to undertake a long-needed renovation -- if not a rebuilding -- of Avery Fisher Hall, any such project would require the Philharmonic to find a temporary new home while the work is completed. Carnegie Hall was always considered the logical candidate to house the orchestra during that time. But working out those details might prove to be another test after the failed merger.

Well before Tuesday’s announcement, there were signs of bad blood between the managers of the Philharmonic and Carnegie Hall. Last month, at the opening of Carnegie’s new 600-seat third stage, Zankel Hall, the top executives of the two institutions -- the orchestra’s Mehta and the concert hall’s Robert Harth -- sat a few seats apart in the balcony but made little effort to appear friendly.

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Times staff writer Mark Swed in Los Angeles contributed to this report.