Sports
WWE-Endeavor blockbuster pumps up Silver Lake's media bets
April 3, 2023
As one of private equity's top investors in the digital economy, Silver Lake has been amping up its bets on sports and entertainment through cut-and-dried PE dealmaking of buyouts and large minority stakes.
Over the weekend, however, the firm's entertainment portfolio gained one of its most significant additions in years without relying on either of those tactics. Silver Lake, which is the biggest shareholder in entertainment mogul Ari Emanuel's Endeavor Group, is doubling down on theatrical fighting as a result of Endeavor's blockbuster acquisition of World Wrestling Entertainment Inc.
The private equity firm, best known for its software and tech-adjacent buyouts, has been expanding into ownership of baseball, rugby, soccer and basketball in recent years as the business of sports increasingly morphs into tech-enabled global content distribution.
In its deal with WWE, Endeavor's media and sports-focused holding company is now poised to become a part-owner of two professional fighting organizations.
On Monday Endeavor announced an agreement to take 51% control of World Wrestling Entertainment from its 70-year owners, the McMahon family, at a valuation of $9.3 billion.
Endeavor said it plans to combine WWE with its own mixed martial arts promoter Ultimate Fighting Championship, or UFC, creating a new professional fighting-focused business that the companies gave a combined enterprise value of $21 billion.
A backer of Endeavor since 2012, Silver Lake held a 31.5% stake in the company as of the end of 2022, filings show.
Silver Lake co-CEO Egon Durban has served as chairman of Endeavor's board since 2014, but it's unclear what official leadership role he could take in the combined UFC-WWE. A Silver Lake spokesperson declined to comment.
Other PE backers of Endeavor, which went public in 2021, include the Canada Pension Plan Investment Board, its second-largest investor with a 7.2% stake, and KKR, with 2.9%.
Initial reactions from Wall Street were lackluster. Endeavor's share price dropped 5.89% and WWE's stock slid 2.15%.
If approved by shareholders, the pact with WWE would allow Silver Lake to further diversify its sports-related holdings.
Last year, the firm made two such deals: It acquired a minority stake in June in the freshly created commercial vehicle behind New Zealand Rugby for $130 million. And in August, Silver Lake bought out Endeavor's ownership of Diamond Baseball, a holding company for 10 minor league baseball teams. On a third continent, the firm expanded its investment in City Football Group.
Silver Lake also has a stake in Madison Square Garden Sports, owner of the pro sports teams that call the iconic arena home, including the New York Knicks and New York Rangers.
In late 2021, Silver Lake bought one-third of the Australian Professional Leagues with a $100 million investment, and plans to build out a digital media platform for the soccer leagues' fans. The firm markets its APL investment as "a digital sports entertainment business."
Featured image of Endeavor Group CEO Ari Emanuel by Chris Unger/Getty Images
Over the weekend, however, the firm's entertainment portfolio gained one of its most significant additions in years without relying on either of those tactics. Silver Lake, which is the biggest shareholder in entertainment mogul Ari Emanuel's Endeavor Group, is doubling down on theatrical fighting as a result of Endeavor's blockbuster acquisition of World Wrestling Entertainment Inc.
The private equity firm, best known for its software and tech-adjacent buyouts, has been expanding into ownership of baseball, rugby, soccer and basketball in recent years as the business of sports increasingly morphs into tech-enabled global content distribution.
In its deal with WWE, Endeavor's media and sports-focused holding company is now poised to become a part-owner of two professional fighting organizations.
On Monday Endeavor announced an agreement to take 51% control of World Wrestling Entertainment from its 70-year owners, the McMahon family, at a valuation of $9.3 billion.
Endeavor said it plans to combine WWE with its own mixed martial arts promoter Ultimate Fighting Championship, or UFC, creating a new professional fighting-focused business that the companies gave a combined enterprise value of $21 billion.
A backer of Endeavor since 2012, Silver Lake held a 31.5% stake in the company as of the end of 2022, filings show.
Silver Lake co-CEO Egon Durban has served as chairman of Endeavor's board since 2014, but it's unclear what official leadership role he could take in the combined UFC-WWE. A Silver Lake spokesperson declined to comment.
Other PE backers of Endeavor, which went public in 2021, include the Canada Pension Plan Investment Board, its second-largest investor with a 7.2% stake, and KKR, with 2.9%.
Initial reactions from Wall Street were lackluster. Endeavor's share price dropped 5.89% and WWE's stock slid 2.15%.
If approved by shareholders, the pact with WWE would allow Silver Lake to further diversify its sports-related holdings.
Last year, the firm made two such deals: It acquired a minority stake in June in the freshly created commercial vehicle behind New Zealand Rugby for $130 million. And in August, Silver Lake bought out Endeavor's ownership of Diamond Baseball, a holding company for 10 minor league baseball teams. On a third continent, the firm expanded its investment in City Football Group.
Silver Lake also has a stake in Madison Square Garden Sports, owner of the pro sports teams that call the iconic arena home, including the New York Knicks and New York Rangers.
In late 2021, Silver Lake bought one-third of the Australian Professional Leagues with a $100 million investment, and plans to build out a digital media platform for the soccer leagues' fans. The firm markets its APL investment as "a digital sports entertainment business."
Featured image of Endeavor Group CEO Ari Emanuel by Chris Unger/Getty Images
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