The parent company of WWE and UFC is buying Professional Bull Riders, On Location and IMG from Endeavor Group in an all-stock deal worth $3.25 billion.
The sale to parent company TKO is part of Endeavor’s efforts to divest some of its assets as it looks set to be taken private in a proposed transaction with private equity firm Silver Lake, which was announced in April. Ariel Emanuel, who is CEO of Endeavor, is also executive chairman and CEO of TKO.
Professional Bull Riders is a bull riding competition with more than 200 annual live events, approximately 1.25 million fans and reaching more than 285 million households in more than 65 territories. On Location is a live events company for more than 1,200 sporting events, including the Super Bowl, Ryder Cup and NCAA Final Four. IMG is a distributor and producer of sports content, packaging and selling media rights and brand partnerships, and providing consulting, digital services and event management to clients including the National Football League and National Hockey League.
Associated Press and IMG co-own the joint venture SNTVthat distributes sports videos and highlights around the world.
Parent company TKO group said Thursday that the acquisition of Endeavor Group will complement its existing business and expand its reach in the premium sports market.
“PBR, On Location and IMG are leading assets that meaningfully strengthen TKO’s portfolio and strengthen our position in premium sports worldwide,” TKO Chief Operating Officer Mark Shapiro said in a statement. “Within TKO, they will help grow our revenue streams and position us to take even greater advantage of some of the most attractive parts of our sports ecosystem: media rights, live events, ticketing, premium experiences, brand partnerships and site fees.”
As part of the deal, Endeavor will purchase approximately 26.14 million common units from TKO Operating Co. receive and will subscribe to an equal number of shares of TKO’s Class B shares. Endeavor is expected to own approximately 59% of TKO, while existing TKO shareholders will own the remaining 41% upon completion of the transaction.
“By expanding its presence in the premium sports market, TKO is poised to unlock new revenue streams through media rights, live events, ticketing, premium experiences, brand partnerships and site fees,” Jefferies Randal Konik said in a note to clients. . “This strategic step not only strengthens the market position, but also prepares the way for sustainable growth and greater shareholder value.”
The deal is expected to close in the first half of next year.
TKO Group also announced Thursday that its board has approved the repurchase of up to $2 billion of its common stock.
Shares of Stamford, Conn.-based TKO Group Holdings Inc. fell more than 8% in afternoon trading Thursday.