UFC parent Endeavor to strike $13 billion private deal with Silver Lake
Endeavor Group Holdings, Inc. (NYSE: EDR ) is to be taken private by venture capital firm Silver Lake in a deal valued at $27.50 per share, representing an equity value of $13 billion.
Silver Lake, which owns 71% of the voting shares of Endeavor, announced last October that it was exploring alternatives for the entertainment and sports company, including taking it private. The $27.50 per share offer values the target company at a significant premium to the closing price of $17.72 on the day Silver Lake plans to seek alternatives for the company. The purchase price is also higher than Endeavor's closing price of $25.81 today.
Under the terms of the agreement, Silver Lake will acquire 100% of the outstanding shares (excluding rollover shares) it does not already own. Endeavor shareholders will receive $27.50 per share in cash, a premium of 55% to Endeavor's unaffected share price of $17.72 per share at the close of business on October 25, 2023 (Endeavor's last full trading day prior to the announcement) and a premium of $39 to Endeavor's share price. %The 30-day volume weighted average price (VWAP) is not affected as we consider strategic alternatives," the company said in a statement.
The transaction is expected to close by the end of the first quarter of 2025.
UFC remains a public company
Silver Lake has been an investor in Endeavor since 2012, supporting the latter's acquisition of the Ultimate Fighting Championship (UFC) in 2016.
UFC became one of the gems in the company's portfolio. Last year, Endeavor completed its acquisition of World Wrestling Entertainment for $9.3 billion. The buyer merged WWE with UFC and changed its stock ticker to "TKO". When Endeavor is formally acquired by Silver Lake, TKO Group Holdings will remain a publicly traded company.
“Silver Lake expects that when the full value of TKO is integrated into Endeavor, the total enterprise value will be $25 billion, which would be the largest public-private investment transaction by a private equity sponsor in more than a decade and the largest of any transaction. largest deal ever,” the venture capital firm added in the statement.
Year to date, Endeavor shares are up 8.77% and TKO Group shares are up 11%.
Endeavor and Silver Lake have some stakes
Endeavor has some experience in the sports betting space. Its IMG Arena unit provides data to sports betting operators. In 2022, Endeavor strengthened the business by acquiring the OpenBet sports betting arm from what was then known as Scientific Games. OpenBet customers include DraftKings, FanDuel, William Hill and WynnBet.
For its part, Silver Lake is an investor in Fanatics, an upstart in the U.S. online sports betting industry. The company also has interests in multiple sports leagues and teams.
Silver Lake manages $102 billion in assets and its portfolio companies generate $258 billion in revenue, according to its website.
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Source: www.casino.org
