Endeavor had to price an IPO, probably within hours, about $ 27 a share, after last week it said it would reach $ 32.
As a sign that Wall Street's appetite for investing in talent agencies and even diversified media outlets may be lower than expected, Endeavor Group has delayed its initial public offering.
"Endeavor will continue to evaluate the timing of the proposal, as market conditions evolve," the company said Thursday.
Endeavor was expected to announce a share price for its IPO, probably within hours, about $ 27, after last week it said it would reach $ 32. But in the end, the IPO was delayed ̵
A reduced share price, combined with a lower-than-expected number of shares to be granted, would mean that the parent of the WME and Ultimate Fighting Championship could raise about $ 360 million in IPOs when
Endeavor shares were set to start trading on the New York Stock Exchange on Friday under the symbol "EDR", with an initial market cap short of previous valuations north of 8 billion. dollars.
The presentation of an IPO is probably a huge disappointment for top executives and many of the other 7,000 employees who were expected to take advantage of the tons of combined bonuses of $ 1 billion. An IPO would also be a huge win given the time, as WME – along with other major Hollywood talent agencies – is still waging a battle with writers, many of whom have broken ties with their agents.
Aggression of agencies with WGA involves packing fees that agencies collect for tying talent to a television project, writers claim to increase the agencies' profits on their behalf. Some Wall Street observers have privately opined that Endeavor is making progress with its IPO, though in part its less bullish sentiment proves that WME's business is not dependent on packaging fees and is not much damaged by the defect in much of its
Many observers predicted that the feud would have to be resolved before every IPO, and in fact the WGA had taken a direct end to Endeavor's IPO, once telling the SEC that WME was inflating its client base and on another occasion. which states that it is "impossible to reconcile The agency's main goals – to serve the best interests of its clients – with businesses to maximize Wall Street returns. "Whether these efforts have paid off is difficult to say.
Endeavor is also fighting five pending lawsuits filed by a group of UFC fighters for years, making antitrust claims and accusing the company of changing them. Some fighters are also trying to unite Ize, the UFC's efforts are vigorously resisting.
In an SEC case, Endeavor acknowledges that, between lawsuits filed by WGA fighters and the UFC, plaintiffs may seek reimbursement of "very large or undetermined amounts" of money and the outcome "may remain unknown for significant periods of time. . "
An IPO would be significantly different, as it would require the WME to disclose financial details that have been kept secret by historical agencies that were tightly closed. Plus, Endeavor's IPO could encourage other majors, such as CAA and United Talent Agency, to follow suit one day, though these companies are not yet as diverse as Endeavor, whose assets also include Professional Bull Riders, Frize Art Fair, NeuLion streaming company and 160over90 marketing agency.
When filing for an IPO before an IPO, it reported revenue of $ 2.05 billion for the first six months of 2019 with operating income of $ 10.3 million and a net loss of $ 223 million. Ari Emanuel and Patrick Whitsell, co-chairs, along with CFO Jason Lublin, Endeavor President Mark Shapiro, Bozoma St. John's Chief Marketing Officer and top human resources manager Kerry Chandler, are likely to be millions of dollars right now, like Lake Partners silver the first private equity firm to buy in Endeavor in 2012 and since then has acquired a significant, albeit minority, stake.
In a pre-IPO roadshow video, Lublin says: "We will publish to be more nimble and responsive to our customers and … to give us capital and currency for M&A, which is and will continue to be central to our strategy. "
In the same video, Emanuel adds," I don't believe there is another platform like ours. I have competition in the advertising business, talent agency and sports business, but they are all separate companies. … I am before you with miles and miles. ”
Obviously Wall Street does not buy what executives sell, at least not to the extent they hoped. The Yanking IPO is a sign bankers, executives and all other participants were not sure that the shares would be well received and would probably be trading below even the recently lowered expectations.
The Writers Guild of America West issued the following statement:  "Reports that Endeavor's IPO has been withdrawn indicate that investors have not purchased the company's conflicting business practices."
26 September 16:13: Updated with WGA statement.