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US private equity group Silver Lake is considering taking Endeavor Group private, with a potential deal for Ari Emanuel’s Hollywood talent agency that would be one of the year’s largest buyouts.
Silver Lake already controls about 71 per cent of Endeavor’s voting rights and its co-chief executive officer Egon Durban and managing director Stephen Evans sit on the agency’s board.
Its announcement came after Endeavor said on Wednesday that it was considering strategic alternatives to maximise the value of its publicly listed stock. Endeavor’s shares jumped by almost 25 per cent after it announced the strategic review, giving it an enterprise value of about $14bn.
The potential takeover comes after Endeavor merged mixed martial arts league Ultimate Fighting Championship with World Wrestling Entertainment last month in an all-stock deal that left the agency as a standalone public company, with clients including Angelina Jolie and Lin-Manuel Miranda.
It also follows last month’s move by France’s billionaire Pinault family to buy a majority stake in rival Hollywood talent manager Creative Artists Agency at an enterprise value of more than $7bn.
“Silver Lake is currently working towards making a proposal to take Endeavor private,” the California-based firm said in a statement. “Silver Lake firmly believes in Endeavor’s business and is not interested in selling its shares in Endeavor to a third-party nor in entertaining bids for assets that are a part of Endeavor,” it added.
Emanuel, Endeavor’s chief executive, said his company would consider a number of options but ruled out a sale of its interest in TKO, the new entity that combined UFC and WWE.
“Given the continued dislocation between Endeavor’s public market value and the intrinsic value of Endeavor’s underlying assets, we believe an evaluation of strategic alternatives is a prudent approach to ensure we are maximising value for our shareholders,” he said.
Earlier this year, Durban told the Financial Times the private equity group had decided to focus its efforts on larger takeovers as public markets have become dislocated.
“If you see us invest right now, by definition it will be a big all-in bet,” Durban said. “You’re going to see us do . . . a handful or two of large, really important investments a year and that’s it.”
Silver Lake first invested in Endeavor in 2012 when it was called William Morris Endeavor, a standalone talent agency run by Emanuel. In 2016, Silver Lake and Emanuel bought a controlling interest in UFC at a $4bn valuation.
They took the renamed company Endeavor public in 2021, but its stock has stagnated on public markets. It spurred the split-up of the combat assets from the talent agency, and the current strategic review.