Editor Note: ‘Early Entrants’ is a series of sports business ‘rumblings’ before the news breaks.
Endeavor Likely Going to Market Without On Location Experiences
Endeavor Group Holdings, Inc. will go public (NYSE: EDR) on Friday (9.27), but it appears as if the company will do so without having closed on On Location Experiences. Remember, back on August 2nd, the WSJ reported that the talent and media conglomerate was delaying their IPO in part because it was “closing in on” an acquisition of the premium experiential hospitality provider.
One source tied to an OLE stakeholder has since told JohnWallStreet that narrative was nothing more than “a folly” – taken by the media at face value as the asset would have “sexy’d up” the debt-laden company – and said that they haven’t heard any discussions that would indicate the transaction would be completed within the next 48 hours. In fact, there’s no guarantee that a deal ever gets done; it’s not as if the NFL & co. are looking to dump the widely profitable business and a failed IPO could impact Endeavor’s interest in and/or ability to fund the purchase.
CBS Sports “Inching Towards” Deal with Licensed Gaming Operator
ESPN (Caesars), Turner Sports (Caesars) and Fox Sports (The Stars Group) have all announced high-profile sports betting partnerships over the last seven months. A pair of well-connected gaming industry sources tell JohnWallStreet that CBS Sports is “inching towards” a deal of their own with a licensed operator. While it remains unclear who the licensee is, the “broad gaming and daily fantasy partnership” is expected to be marketing based with the licensee advertising across all of CBS’ digital assets; the deal is also expected to contain a linear component.
“Overbearing Control Owners” Add to Struggles for Limited Partners in Sacramento, Memphis
Sports Business Journal published a story on Monday entitled “Hornets sell stake, but limited partners hard to find” that focused on the struggles associated with selling non-voting minority interests in NBA teams at current valuations and the proposed fund that would buy the shares from minority partners struggling to get out of their investments. Sacramento and Memphis were cited as examples of clubs with minority shareholders hurt by the inefficient, illiquid secondary market for non-controlling team interests; OKC is another club with a limited partner(s) unable to find a buyer.
Those in Sacramento and Memphis are also facing headwinds that do not plague L.P.s in other markets. Multiple sources familiar with the league’s available investment opportunities have suggested that those two teams’ “overbearing control owners” have made what is already a difficult task even more challenging.
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