Endeavor gets On Location deal over the line as NFL increases stake
By Simon Ward
Endeavor, the former Hollywood talent agency that has developed into a global entertainment, sport and content company, has today completed the acquisition of On Location Experiences, the premium hospitality business.
The deal for a majority stake is reported to be worth about $660 million, and will involve the NFL increasing its stake, held via strategic investment arm 32 Equity, from 16 per cent to upwards of 20 per cent, although it was thought to be seeking even more.
The company was originally known as NFL On Location, and until now its shareholders included Bruin Sports Capital, the international sports and entertainment investment company, and RedBird Capital, which each owned more than 30 per cent, and the Carlyle Group, which had a 10-per-cent stake.
Endeavor has been targeting the firm, which is the official hospitality partner of the NFL and offers luxury travel, accommodation and experiences such as on-field and post-game access for events including the Super Bowl, NCAA college sports showpieces, golf’s Masters and Ryder Cup and tennis’ US Open, for the best part of a year.
However, the deal was held up as Endeavor made plans for an initial public offering.
The listing on the New York Stock Exchange was postponed indefinitely last September amid unfavourable market conditions, and the takeover of On Location will be seen as a demonstration of continued ambition at Endeavor following the high-profile acquisitions of IMG, the international sports agency, and UFC, the popular mixed martial arts series, in recent years.
Paul Caine, the experienced media executive who has had senior roles at Bloomberg, Westwood One and Time Inc., and is a long-time associate of Endeavor president Mark Shapiro, has been appointed chief executive, in succession to John Collins.
Collins, who has been in the post for four years, will serve as an advisor to On Location and Endeavor during the integration period.
Caine is new to sport, and there are likely to be efforts to diversify the business, moving into properties that align with Endeavor’s existing portfolio.
In a statement, Ariel Emanuel, the chief executive of Endeavor, said: "By bringing together a leader like On Location with Endeavor’s access and reach, we can advance the way consumers and brands think about money-can’t-buy experiences.
"Partnering with the NFL will enable us to leverage the best-in-class executions around one of the biggest events in the world, the Super Bowl, and extend this same level of service and experiences to other sports and entertainment properties globally.”
Roger Goodell, the NFL commissioner, added: "We are excited to partner with Endeavor to grow On Location Experiences globally. We are committed to offering NFL fans unique and first-class experiences at our events. On Location shares this commitment and delivers value for its partners and delights fans at its events around the world."
The deal will come as a windfall to Bruin and RedBird, which acquired the company for about $70 million in April 2015.
It was first reported last April that Endeavor was in negotiations to acquire On Location, which in the previous year is said to have generated about $600 million in revenue and $55 million in earnings before interest, taxes, depreciation and amortisation.
It was claimed that about 40 per cent of the profit was related to the NFL, with 40 per cent coming from other sports and 20 per cent from music and travel.
In December 2017, it acquired PrimeSport, the USA-based sports hospitality and ticketing agency, which it described as “a leader in providing direct access to some of the biggest events in sports and entertainment.”
NFL On Location was the first acquisition made by Bruin, which was launched in 2015 by George Pyne, the former president of IMG Worldwide Sports and Entertainment.
However, while the hospitality firm has experienced significant growth, the sale of the stake enables Bruin to focus on companies in which it has larger holdings and which are less susceptible to economic downturns, and swells its coffers for potential future acquisitions.
Last month, Bruin reached agreement to buy an 80-per-cent stake in Two Circles, the UK-based data-driven sports agency, from advertising giant WPP, in a deal that valued the company at $42 million.
Two Circles had been retained as a part of WPP subsidiary GroupM when it sold IEG, the US sponsorship valuation and measurement company, and the US brand consultancy of ESP Properties to Bruin in 2018.
Other Bruin acquisitions have included: Deltatre, the international sports media services company; Soulsight, an award-winning strategic branding, design and creative agency; Engine Shop, the sports, entertainment and marketing agency; and T Burns Sports Group, the consultancy of Terrence Burns, the Olympic bid and marketing strategist.
Last November, Bruin secured $600 million in new investment from private equity firms CVC Capital Partners and The Jordan Company, which have joined other partners including Rock Ventures, the holding company of Dan Gilbert, the owner of the NBA’s Cleveland Cavaliers, NNS chaired by Naseef Sawiris, the Egyptian billionaire who co-owns English soccer's Aston Villa, and others, meaning that combined investment now amounts to nearly $1 billion.