Endeavor Takes Outright Control of On Location and Endeavor China04/28/2022
Entertainment management and events firm Endeavor Group Holdings has bought outright control of the On Location sports event firm and its older Endeavor China business. The two separate deals will cost Endeavor Group a total of $408 million.
In a regulatory filing Thursday, Endeavor said that it will pay $224 million to buy out the minority shareholders in On Location, a firm that provides hospitality services to the NFL and the Super Bowl. Endeavor previously bought a majority stake in the firm in January 2020. The new deal is to be paid for with the issue of new Endeavor shares. The group is also issuing some $10 million of shares to On Location management and key employees.
In the China deal, Endeavor is buying out the holdings of Sequoia Capital China, Tencent and affiliates of FountainVest Partners which had invested in WME IMG China when it was founded back in 2016. Endeavor said that it had paid for the transaction with $158 million of its shares, without explaining the size of its previous holding. An additional $15 million of Endeavor stock was issued to management and key staff at Endeavor China.
In both cases, the acquired companies become wholly-owned, indirect subsidiaries of Endeavor Group Holdings. “These transactions enable Endeavor to streamline management and create operational efficiencies across these two businesses, while fully integrating them within its network,” said the group.
The deals were done when Endeavor shares were at $24.33 on Wednesday, close to the bottom of their $22-35 trading range over the past 12 months. The group conducted its IPO in April 2021 at $24 per share.
On Location is an official partner to more than 150 iconic rights holders, including the PGA, NCAA, UFC and WWE, as well as numerous musical artists, festivals and fashion events. In 2021, the International Olympic Committee named On Location its first-ever, official global hospitality provider for the Paris 2024, Milan 2026, and Los Angeles 2028 Olympic Games.
Endeavor China straddles entertainment, sports and fashion content and experiences to Chinese audiences. It has produced and supported popular live events ranging from the WGC-HSBC Champions golf tournament to the ATP Chengdu Open to Shenzhen Fashion Week. It also represents leading Chinese artists and athletes.
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