Hollywood Super-Agent Emanuel Cashes In With Endeavor Group IPO
(Bloomberg) -- Ari Emanuel, the brash Hollywood power player immortalized by Jeremy Piven in the HBO series “Entourage,” has finally secured his coveted role for his #1 client: himself.
The part he landed: The ultra-wealthy head of a publicly traded company. Shares of Endeavor Group Holdings Inc., the entertainment and talent firm he co-founded, rose 5% in its first day of trading Thursday and were up another 5.3% to $26.53 at 11:12 a.m. in New York. It’s been a positive start for the pandemic-battered enterprise whose previous attempt at going public flopped.
“We’re unique. There’s nobody else that sits in all the places we sit,” Emanuel, 60, said Thursday in an interview with Bloomberg Quicktake. “Nobody compares to us.”
That bravado is characteristic of the Illinois native and brother to former Chicago Mayor Rahm Emanuel, who’s steered the company’s shift from talent agency to multipronged entertainment empire over the past quarter century. After earning a reputation as a hot-tempered and ruthless negotiator on behalf of clients like Dwayne “The Rock” Johnson and Charlize Theron, he’s applied those tactics more recently to corporate dealmaking.
He’s matched in ambition, if not manner, by his fellow co-founder Patrick Whitesell, 56, a comparatively soft-spoken Iowa native often described as the yin to Emanuel’s fiery yang. Whitesell briefly became a tabloid fixture in 2019 when his now ex-wife Lauren Sanchez was revealed to be the girlfriend of then-married Jeff Bezos, founder of Amazon and the world’s richest person.
Once an upstart agency, Endeavor signaled its appetite for growth in 2009 when it swallowed up much larger rival, William Morris, followed by sports and fashion-focused IMG Worldwide five years later. But it was their acquisition of a controlling stake in mixed-martial arts promoter UFC in 2016 that transformed the Beverly Hills, California-based company into an entity that both represented and owned entertainment content.
It’s that latter piece of the business that’s enabled Emanuel and Whitesell to climb their way into the ranks of titans. While the most successful agents can rake in millions in earnings from their cut of clients’ salaries, it can’t compare to the potential billions to be made from equity stakes in the public markets.
Emanuel and Whitesell together control shares valued at almost $840 million, according to Endeavor’s prospectus. About two-thirds are owned by management holding companies, whose other shareholders include current and former senior executives and employees of Endeavor. Emanuel and Whitesell control the holding companies, though their exact stake isn’t disclosed in the filing. They stand to receive millions more in shares if the stock hits certain benchmarks.
The pair also received $165 million each in 2017 when the company bought back shares from the executives.
Other winners from the offering include private equity firm Silver Lake, the company’s biggest shareholder, and KKR & Co. A raft of prominent early investors also participated in a concurrent private placement, including Michael Dell’s MSD Capital, Abu Dhabi’s Mubadala, Dan Loeb’s Third Point and Fertitta Capital.
It’s a marked turnaround from a year-and-a-half ago when Endeavor’s planned IPO was yanked hours before trading was set to begin. A softening in the market for new listings amid the WeWork debacle forced the decision, dealing another blow to Endeavor and Emanuel, who earlier that year returned a $400 million investment to Saudi Arabia in the wake of journalist Jamal Khashoggi’s murder.
“We have a perfect mix in the company in relation to ownership and representation,” Emanuel said. “Covid has given us a huge opportunity on the M&A side. We think we are a better company public, right now.”
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