The much anticipated initial public offering for Endeavor Group Holdings Inc., owner of the powerful WME talent agency, will be held in September or later, said two people familiar with the matter who were not authorized to comment.
Many prospective investors had anticipated the Beverly Hills-based company _ the industry's largest agency, which has aggressively diversified into sports and other businesses in recent years _ would offer its shares to the public this summer.
But holding the IPO in the fall or later will give the company more time to complete a possible acquisition that could increase its value, analysts said.
Endeavor is nearing a deal to acquire hospitality and live-events firm On Location Experiences LLC for as much as $700 million, said the people familiar with the matter. The Wall Street Journal first reported on the pending acquisition.
Endeavor declined to comment.
Endeavor, led by Ari Emanuel, filed its IPO paperwork with regulators in May, in the midst of a tense feud between talent agencies and Hollywood's union representing writers, which says talent reps are illegally enriching themselves on the backs of their clients. Agencies have disputed the claim and accused the union of stalling negotiations over ending longstanding industry practices.
The Writers Guild of America in March blasted the IPO plans, saying it only "only strengthens the call for the conflicted and illegal practices of the major talent agencies to end."
Backed by private equity firm Silver Lake Partners, Endeavor is expected to use proceeds from the IPO to pay down debt brought on by major acquisitions. The company paid $4 billion to buy mixed martial arts league Ultimate Fighting Championship in 2016, and previously bought sports-focused agency IMG for about $2.4 billion in 2014.
The company has aimed to become involved in all aspects of entertainment, whether its representing talent, investing in TV shows such as "Killing Eve" or selling experiences to audiences.
"As the entertainment industry moves toward a closed ecosystem model with less transparency, our clients and businesses need more insight, resources and solutions than ever before," Emanuel wrote in a letter as part of the company's S-1 filing.
For the fiscal year that ended in December 2018, Endeavor reported $3.6 billion in revenue, with net income of $231.3 million. The company reported adjusted net income of $100.1 million for the year.
Endeavor last year secured an investment of at least $400 million from Saudi Arabia's sovereign wealth fund, but the company moved to return the capital after the murder of Washington Post contributor Jamal Khashoggi at the Saudi Consulate in Turkey in October 2018.
(c)2019 Los Angeles Times
Visit the Los Angeles Times at www.latimes.com
Distributed by Tribune Content Agency, LLC.