Endeavor to Transition into a Privately Held Company Following Three Years Since IPO

Endeavor to Transition into a Privately Held Company Following Three Years Since IPO

After three years as a publicly traded company, the Ari Emanuel-led Endeavor is going private.

The Beverly Hills-based sports and entertainment giant — the owner of talent agencies WME and IMG as well as assets like the PBR bull riding organization, betting data firm OpenBet, marketing agency 160over90 and hospitality firm On Location — will be acquired by majority shareholder Silver Lake at a valuation of $13 billion, the firm said Tuesday.

Private equity firm Silver Lake will acquire all outstanding shares and Endeavor stockholders will receive $27.50 per share. The company traded on the New York Stock Exchange as “EDR” and closed at $25.27 per share on April 1. (Silver Lake notes that the company was trading at $17.72 on Oct. 25, a day before Endeavor formally declared a review of “strategic alternatives,” including the option to go private.)

The move marks the end of a run that began pre-pandemic in May 2019, when the company filed its intent to go public only to postpone the plan only a few months later amid unfavorable market conditions. At the time, and throughout its foray as a public company, the question that seemed to follow Endeavor executives was how investors should value the collection of entertainment and sports assets along with major talent agencies as a whole.

In Beverly Hills, the sale of WME’s major rival CAA, to Artémis, the investment firm controlled by François-Henri Pinault, at a valuation of $7 billion last September drew notice. If CAA alone was worth $7 billion, then WME plus all of the assets that Endeavor controls should command significant value, too, the thinking went. And Emanuel, at investor events, has voiced that Endeavor is undervalued compared to its rivals.

In a quest to unlock value, Endeavor spun off its mixed martial arts league UFC in a merger with World Wrestling Entertainment last year to form the holding company TKO Group Holdings, which trades as “TKO” on the NYSE. Emanuel also serves as CEO of TKO while Endeavor president Mark Shapiro is also president and COO of the sports firm. Silver Lake now lists the total enterprise value of Endeavor and TKO Group at $25 billion.

Silver Lake, led by co-CEOs Egon Durban and Greg Mondre, made its initial investment in WME in 2012, a year before the company began rolling up acquisitions. In late 2013, it bought fashion and sports focused talent agency IMG for $2.4 billion, a move that fueled private equity investment across the representation business and at Big 3 agency rivals like CAA and UTA.

“Together, we have built and grown Endeavor from $350 million in annual revenue when we first invested in 2012 to nearly $6 billion in consolidated revenue today,” Durban said. “Now, Endeavor can take advantage of its unique core platform to meet the dynamic forces driving growth in content, sports, and live events with bold vision.”

“Since 2012, Endeavor’s strategic partnership with Silver Lake and Egon Durban have been central to our evolution,” Emanuel stated on going private. “We believe this transaction will maximize value for all of Endeavor’s public stockholders and are excited to continue to unlock and invest in the growth opportunities ahead as a private company.”

Added Patrick Whitesell, executive chairman of Endeavor: “With Silver Lake’s continued partnership and support, Endeavor is ideally positioned to capitalize on compelling trends in media and entertainment, where global content spending has reached more than $200 billion per year.”

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