Endeavor going private again in $13bn deal with Silver Lake

Ari Emanuel (Source: Endeavor)

US sports and entertainment giant Endeavor is going private again after agreeing an acquisition deal with tech investment firm Silver Lake.

Under the deal, Silver Lake, which is the majority shareholder with a 71% stake in the Ari Emanuel-led firm, will acquire 100% of the outstanding shares that it does not already own.

In October, Silver Lake first announced that it was “currently working toward making a proposal to take Endeavor private,” sending shares soaring by 25% at the time.

The transaction values Endeavor at $13bn and is expected to close by the first quarter of 2025, subject to customary closing conditions and required regulatory approvals. The deal does not include UFC and WWE parent company TKO, which will remain a publicly traded company.

The consolidated enterprise value is almost double that, at $25bn, when including TKO, which the two companies said makes this the “largest private equity sponsor public-to-private investment transaction in over a decade, and the largest ever in the media and entertainment sector.”

Endeavor stockholders will receive $27.50 per share in cash, which is 55% above the $17.72 per share at market close on 25 October, 2023, which was the last full trading day prior to Endeavor’s announcement that it was reviewing strategic alternatives.

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Maximising value

Silver Lake has made several investments in Endeavor over the past 12 years, beginning with its initial investment in William Morris Endeavor in 2012 and continuing through Endeavor’s subsequent acquisition of IMG in 2014 and initial public offering in 2021.

The firm also supported Endeavor’s acquisition of UFC in 2016 and the merger of UFC and WWE to create sports and entertainment company TKO.

Endeavor’s fortunes have fluxed over recent years, with the Hollywood firm selling its production interests three years ago to South Korea’s CJ ENM, following a long-running dispute with the Writers Guild of America (WGA) that argued the agency’s growing focus on production was not in the best interests of talent on its books.

The slimmed down Endeavor has since been increasing its unscripted activity including, taking a minority stake in LA-based Velvet Hammer Media, which was launched by former HBO Max execs Jennifer O’Connell and Rebecca Quinn.

That came six months after Endeavor acquired Asylum Entertainment Group – the parent company of production companies The Content Group, Texas Crew Productions, Big City TV, Breaklight Pictures, and Audity. The group’s slate of reality, documentary and other unscripted series includes 30 for 30, Hillsong: A Megachurch Exposed, American Cartel, King of the Con, Sins of the Amish and How I Caught My Killer.

Ari Emanuel, CEO of Endeavor, said: “Since 2012, Endeavor’s strategic partnership with Silver Lake and Egon Durban have been central to our evolution into the global sports and entertainment leader we are today. We believe this transaction will maximise 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.”

Durban, co-CEO and managing partner of Silver Lake, and chairman of the board of Endeavor, added: “Together, we have built and grown Endeavor from $350m in annual revenue when we first invested in 2012 to nearly $6bn in consolidated revenue today.

“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.”