Endeavor Stockholders to Receive $27.50 Per
Share in Cash, a 55% Premium Value to Unaffected Share
Price
Special Committee of Endeavor’s Independent
Directors Unanimously Recommended Approval of Transaction
Transaction at $13 Billion Equity Value and
$25 Billion Consolidated Enterprise Value is Largest Private Equity
Sponsor Take-Private in 10 Years and Largest Ever in Media &
Entertainment Sector
Endeavor Group Holdings, Inc. (NYSE: EDR) (“Endeavor” or the
“Company”), a global sports and entertainment company, today
announced that it has entered into a definitive agreement to be
acquired by Silver Lake, the global leader in technology investing,
in partnership with the Endeavor management team and additional
anchor investors.
Under the terms of the agreement, Silver Lake will acquire 100%
of the outstanding shares it does not already own, other than
rolled interests. Endeavor stockholders will receive $27.50 per
share in cash, representing a 55% premium to the unaffected share
price of $17.72 per share at market close on October 25, 2023, the
last full trading day prior to Endeavor’s announcement of its
review of strategic alternatives, and a 39% premium to Endeavor’s
unaffected 30‐day VWAP.
With the significant premium being delivered to stockholders,
Endeavor is being acquired at an equity value of $13 billion.
Silver Lake believes that when consolidating all of TKO’s value
into Endeavor, the combined total enterprise value of $25 billion
will make 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. On the unaffected date, the
equity value was $8.2 billion, and the premium to be paid by Silver
Lake represents $4.6 billion more equity value to all Endeavor
stockholders.
Ariel 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 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.”
Egon Durban, Co-CEO and Managing Partner of Silver Lake, and
Chairman of the Board of Endeavor, said: “Our unwavering belief in
Ari and Patrick, together with Mark and other talented leaders at
Endeavor, has never been stronger. This is a very special
partnership. 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. 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. Consistent with our mission and underscored by this
commitment being among the largest in Silver Lake’s history, we are
all in on working with the Endeavor team and our trusted anchor
investors to create value by accelerating growth at scale.”
Patrick Whitesell, Executive Chairman of Endeavor, said: “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. In a business where the only constant is
change, I know Endeavor will continue to lead the industry
forward.”
Mark Shapiro, President and Chief Operating Officer of Endeavor,
said: “Endeavor’s assets and capabilities across entertainment,
sports, fashion, and music are unparalleled. This transaction
further enhances our ability to deliver category-defining deals and
iconic events and experiences for clients, partners, and fans
around the world. Egon, Stephen, and the broader Silver Lake team
have been and will continue to be phenomenal partners in Endeavor’s
journey, and we look forward to the road ahead.”
Stephen Evans, Managing Director of Silver Lake and a Director
of Endeavor, said: “The team at Silver Lake is proud of our
longstanding partnership with Endeavor, marked by more than $3.5
billion of direct investment across six distinct transactions over
12 years. We are excited about what we can achieve together in this
next phase, spearheaded by Endeavor’s visionary expertise across
talent representation and content and ownership of truly special,
marquee assets in sports.”
The transaction builds on multiple investments Silver Lake has
made in Endeavor starting with Silver Lake’s 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. Silver Lake also supported Endeavor’s acquisition of UFC
in 2016 and the merger of UFC and WWE, creating premium sports and
entertainment company TKO Group Holdings, Inc. (NYSE: TKO) (“TKO”)
in 2023.
TKO is not party to this transaction and will remain a publicly
traded company that will continue to benefit from its connectivity
to Endeavor’s expertise, relationships, and significant
capabilities.
TRANSACTION DETAILS
The premium value delivered by the transaction to Endeavor
stockholders is substantially higher than the median premium in the
low-to-mid-30% range paid in private equity sponsor take-privates
larger than $10 billion in enterprise value over the last five
years in the technology, media, entertainment, and
telecommunications sector.
The consummation of the transaction is not subject to any
financing condition. The transaction will be financed through a
combination of new and reinvested equity from Silver Lake and
additional capital anchored by Mubadala Investment Company, DFO
Management, LLC, Lexington Partners, and funds managed by Goldman
Sachs Asset Management; equity rolled over by members of the
Endeavor management team including Emanuel, Whitesell, and Shapiro;
and new debt financing fully committed by Goldman Sachs, USA, JP
Morgan, N.A., Morgan Stanley Senior Funding, Inc., Bank of America,
N.A., Barclays PLC, Deutsche Bank AG New York, and Royal Bank of
Canada.
Consistent with Endeavor’s announcement on October 25, 2023 of
the initiation of a formal review to evaluate strategic
alternatives, and Silver Lake’s public response that it was working
toward a proposal to take Endeavor private, Endeavor proceeded to
form a Special Committee of independent directors to review and
consider any proposal that might materialize in connection with the
strategic review.
The Special Committee reviewed, negotiated, unanimously
approved, and recommended approval by Endeavor’s Executive
Committee of the proposed transaction. Following formal approval by
Endeavor’s Executive Committee, the definitive agreement was
signed, and the transaction was approved by the written consent of
stockholders representing a majority of the outstanding voting
interests of the Company.
The transaction is subject to the satisfaction of customary
closing conditions and required regulatory approvals. No other
stockholder approval is required. The transaction is expected to
close by the end of the first quarter of 2025. Upon completion of
the transaction, Endeavor’s common stock will no longer be listed
on any public market.
Further information regarding terms and conditions contained in
the definitive transaction agreements will be made available in
Endeavor’s Current Report on Form 8-K, which will be filed in
connection with this transaction.
Advisors
BDT & MSD Partners acted as lead financial advisor to Silver
Lake. Goldman Sachs & Co. LLC, JP Morgan, Morgan Stanley &
Co. LLC, BofA Securities, Barclays, Deutsche Bank Securities Inc.,
and RBC Capital acted as lead financing arrangers and lead
financial advisors to Silver Lake. KKR Capital Markets acted as
global financing advisor to Silver Lake. The Raine Group is also
acting as financial advisor. Simpson Thacher & Bartlett LLP and
Kirkland & Ellis LLP acted as Silver Lake’s legal advisors.
Latham & Watkins LLP acted as legal advisor to Endeavor.
Centerview Partners LLC acted as independent financial advisor
to the Special Committee and Cravath, Swaine & Moore LLP acted
as independent legal advisor to the Special Committee.
Debevoise & Plimpton LLP acted as legal advisor to Emanuel.
Freshfields Bruckhaus Deringer LLP acted as legal advisor to
Whitesell. Akin Gump Strauss Hauer & Feld LLP acted as legal
advisor to Shapiro.
About Endeavor
Endeavor (NYSE: EDR) is a global sports and entertainment
company, home to many of the world’s most dynamic and engaging
storytellers, brands, live events, and experiences. The Endeavor
network specializes in talent representation through entertainment
agency WME; sports operations and advisory, event management, media
production and distribution, and brand licensing through IMG; live
event experiences and hospitality through On Location; full-service
marketing through global cultural marketing agency 160over90; and
sports data and technology through OpenBet. Endeavor is also the
majority owner of TKO Group Holdings (NYSE: TKO), a premium sports
and entertainment company comprising UFC and WWE.
About Silver Lake
Silver Lake is a global technology investment firm, with
approximately $102 billion in combined assets under management and
committed capital and a team of professionals based in North
America, Europe and Asia. Silver Lake’s portfolio companies
collectively generate nearly $258 billion of revenue annually and
employ approximately 517,000 people globally.
Forward-Looking Statements
This press release contains, and oral statements made from time
to time by our representatives may contain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933, as
amended (the “Securities Act”), and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking statements
generally include statements regarding the potential transaction
between Endeavor and Silver Lake, including, without limitations,
statements regarding the expected impacts and benefits of the
potential transaction, timing of the transaction closing, and
future opportunities and expected performance. All statements in
this press release that do not relate to matters of historical fact
should be considered forward-looking statements. In some cases, you
can identify forward-looking statements by terms such as “may,”
“will,” “outlook”, “should,” “expects,” “plans,” “anticipates,”
“could,” “intends,” “targets,” “projects,” “contemplates,”
“believes,” “estimates,” “predicts,” “potential” or “continue” or
the negative of these terms or other similar expressions. The
forward-looking statements in this communication are only
predictions. Endeavor’s management have based these forward-looking
statements largely on their current expectations and projections
about future events and financial trends that management believes
may affect its business, financial condition and results of
operations. These statements are neither promises nor guarantees
and involve known and unknown risks, uncertainties and other
important factors that may cause actual results, performance or
achievements to be materially different from what is expressed or
implied by the forward-looking statements, including, but not
limited to: the transaction will not be consummated; the
possibility that any or all of the various conditions to the
consummation of the transaction may not be satisfied or waived,
including the failure to receive any required regulatory approvals
from any applicable governmental entities (or any conditions,
limitations or restrictions placed on such approvals); the
occurrence of any event, change or other circumstance that could
give rise to the termination of the Merger Agreement; the effect of
the announcement or pendency of the proposed transaction on
Endeavor’s business relationships, operating results, and business
generally; risks that the proposed transaction disrupts current
plans and operations of Endeavor and potential difficulties in
Endeavor’s employee retention as a result of the proposed
transaction; there may be liabilities that are not known, probable
or estimable at this time or unexpected costs, charges or expenses;
the transaction may result in the diversion of management’s time
and attention to issues relating to the transaction; there may be
significant transaction costs in connection with the transaction;
unfavorable outcome of legal proceedings that may be instituted
against Endeavor and Silver Lake following the announcement of the
transaction; and the risk that Endeavor’s stock price may decline
significantly if the proposed transaction is not consummated. In
addition, a number of important factors could cause Endeavor’s
actual future results and other future circumstances to differ
materially from those expressed in any forward-looking statements,
including but not limited to those important factors discussed in
Part I, Item 1A “Risk Factors” in Endeavor’s Annual Report on Form
10-K for the fiscal year ended December 31, 2023, as any such
factors may be updated from time to time in its other filings with
the Securities and Exchange Commission (the “SEC”), accessible on
the SEC’s website at www.sec.gov, Endeavor’s investor relations
site at investor.endeavorco.com. Forward-looking statements speak
only as of the date they are made and, except as may be required
under applicable law, Endeavor undertakes no obligation to update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
Website Disclosure
Investors and others should note that Endeavor announces
material financial and operational information to its investors
using press releases, SEC filings and public conference calls and
webcasts, as well as its Investor Relations site at
investor.endeavorco.com. Endeavor may also use its website as a
distribution channel of material Company information. In addition,
you may automatically receive email alerts and other information
about Endeavor when you enroll your email address by visiting the
“Investor Email Alerts” option under the Resources tab on
investor.endeavorco.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240402977886/en/
ENDEAVOR CONTACTS Investors: investor@endeavorco.com
Media: Maura McGreevy press@endeavorco.com
Brunswick Group endeavor@brunswickgroup.com
SILVER LAKE CONTACTS Media: Matt Benson/Ginger Li
mediainquiries@silverlake.com
Edelman Smithfield Jennifer.Stroud@edelmansmithfield.com
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