TKO Parent Company Endeavor Being Taken Private By Investment Firm

In a significant business move that will affect WWE, TKO parent company Endeavor has been acquired and is being taken private. The investment firm Silver Lake will take control of the company, with news of the acquisition announced today via press release. Endeavor now joins other Silver Lake holdings including the AMC movie theater chain, Skype, Airbnb, and many more.

This does not mean that TKO Group Holdings will be going private, as the press release states that the company will continue to be publicly traded while receiving "benefit[s] from its connectivity to Endeavor's expertise, relationships, and significant capabilities." TKO's parent company is now run by a private organization rather than a board that's accountable to shareholders.

Typically, private equity firms like Silver Lake buy companies, or parts of them, and then attempt to greatly increase the company's value before eventually selling the business for a profit. This process could take just a few years, or the firm could hold onto its investment for quite a long time.

Endeavor stockholders are set to receive a payout of $27.50 for every share they own. That's a 55% premium over the stock price before the announcement that the company may explore a sale, which they've determined is the fair amount to offer. The press release touted the fact that, with Endeavor estimated to be worth $25 billion, this acquisition is the biggest "private equity sponsor public-to-private investment transaction" in more than 10 years and the biggest media and entertainment transaction ever.

Silver Lake has been an investor in Endeavor since 2012, with Endeavor CEO Ari Emanuel citing the partnership as integral to Endeavor's success over the past decade, including the WWE acquisition. With TKO unaffected by the new change, it seems Emanuel will continue serving as that company's CEO as well.