There appears to be no end in sight for Endeavor’s financial woes.
One of the world’s biggest sports and entertainment agency Endeavor is looking to raise US$250 million by June in a bid to offset its losses during the coronavirus pandemic, according to the New York Post.
With the entertainment industry in near-shutdown, the company’s sports properties such as the Ultimate Fighting Championship (UFC) unable to hold events and IMG’s rights portfolio delivering minimal returns at present, Endeavor’s business is severely hamstrung. Company is also reeling under huge debt & liabilties of $7.2billion.
Company’s credit rating also saw a drop from financial services company Moody’s. Moody’s, which joined S&P Global Ratings in downgrading Endeavor sizeable debt from stable to negative, claimed that the company “has maintained very high leverage levels and issued additional debt to help fund acquisitions historically.”
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Endeavor — a company that includes subsidiaries such talent agency WME IMG, On Location Experiences, Miss Universe Pageant, Professional Bull Riders, and the Ultimate Fighting Championship (UFC) — is saddled with a 4.6 billion debt burden owed to Silver Lake Partners and other private equity investors over the purchase of the UFC in 2016.
The UFC reaped a reported $900 million in revenue in 2019 (only 16% of which was paid out to fighters). However, given that the promotion is yet to resume its live events schedule, Endeavor has lost yet another important source of revenue at a crucial time.
Current Investors Silver Lake is supporting as lead search for investment in agency giant. Silver Lake is reportedly speaking to other parties about investing and could also invest itself, with a US$250 million figure presented to potential suitors.
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