EXCLUSIVE: At WME, what a difference a year has made. Yesterday, many of the agency’s partners took advantage of an opportunity to sell 20% of their shares back to the company, based on the stock price derived from the agency’s recent IPO. The stock of parent company Endeavor was at $28.60 a share. Now a public company, Endeavor would not comment, but my sources said that many took advantage, as the next chance to sell will be two years from now, at around 20%, and another liquidation event two years after that.
There are up to 180 partners — 25 new ones were minted late last year as full salaries were restored — and for the senior partners with the most shares, this is a serious cash windfall, in the millions dollars. The IPO raised over $500 million.
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It was exactly one year ago today that Deadline revealed that along with a pandemic need to lay off or furlough 20% of staff including some agents, longtime partners were still bitter that a long-planned liquidation event in March to cash out 20% on a $3.6 billion valuation got canceled because it would have been irresponsible for a debt-heavy company to empty the kitty like that, with payouts of tens of millions of dollars. But those partners were well aware from S-1 disclosure documents made public during the first IPO attempt that toppers Ari Emanuel and Patrick Whitesell took $162.5 million each, and that some other equity holders did the same. Meanwhile, others said they were encouraged to take more stock in anticipation of the first IPO cash-out, instead of bonuses and raises.
This was before the company withdrew its first attempt at an IPO because of softness in the marketplace, and before the pandemic brought the live event-driven company’s revenues to a screeching halt for a year. All this happened as the major agencies lost their writer clients because of a bitter battle over packaging and affiliated production companies.
It was awkward, but Emanuel and Whitesell asked the partners to hang in there until the business began to recover, in a conference call that sources described as contentious. But at the time, there was no clear indication when that would happen, with a global Covid pandemic raging. Numerous bright agent partners left for other opportunities. Those who stayed had a good day yesterday — post-IPO, Endeavor’s valuation surpassed $3.6 billion — and leaders Emanuel and Whitesell were able to keep their word.
No word on the progress being made on selling 80% of Endeavor Content, part of the truce drawn with the WGA.
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