The Beverly Hills-based sports and entertainment company, Endeavor Group, announced a $450 million deal to sell OpenBet and IMG ARENA to OB Global Holdings LLC in a management buyout.
Under the terms of the transaction, OB Global will acquire OpenBet and IMG Arena, subject to certain adjustments. The deal will be financed through a combination of cash and debt, the company said in a statement.
The deal was backed by Endeavor CEO Ariel Emanuel and OpenBet executives, including CEO Jordan Levin.
Throughout the sale process and even after the deal is completed, Endeavor stated it will continue to seek a third-party buyer for IMG Arena, a sports data provider.
Post the deal, Levin will continue to lead OpenBet, the sports betting and entertainment firm.
“This management buyout allows us to continue executing our vision for increased market expansion and product innovation. Our group is extremely confident in OpenBet’s future considering the premium product offering, superior talent, and solid foundation we already have in place following a strong period of business growth,” Levin said.
The company called the transaction a crucial step toward the completion of the proposed Endeavor take-private by Silver Lake. It is subject to standard closing conditions, including the necessary approvals from relevant gaming regulatory authorities, and is expected to close just prior to the finalization of the take-private deal.
In April this year, private equity firm Silver Lake reached an agreement valued at $13 billion to take Endeavor private, which is expected to be finalized by the end of the first quarter of 2025, Reuters reported.
Under the terms of the agreement, Endeavor shareholders will receive $27.50 per share in cash, which is a 55% premium over the closing price of $17.72.
Silver Lake, which is Endeavor’s largest shareholder, owns around 31% of the company’s outstanding shares as of Dec. 31, 2023. Together with Endeavor Executive Chairman Patrick Whitsell and Emanuel, Silver Lake controls 91.5% of Endeavor’s voting stock through a special class of shares, based on a regulatory filing.
Endeavor paid a much higher amount than $450 million while purchasing OpenBet two years ago, reported Los Angeles Times.
The company executives have previously expressed frustration that the company’s stock price does not accurately reflect the true value of its assets.
In October of this year, Endeavor announced plans to sell three of its businesses—Professional Bull Riders, hospitality arm On Location, and the global sports marketing agency IMG—to TKO Group Holdings, the parent company of WWE and UFC, in an all-stock deal valued at $3.25 billion.
The company is also considering the sale of the Miami Open and Madrid Open tennis tournaments, part of the ATP Masters 1000 and WTA 1000 series, in addition to the art organization, Frieze.
