UFC Parent company Endeavor will make another attempt to go public, roughly 18 months after a failed move to do just that. And ahead of the planned IPO, the company has made some big moves: Tesla founder and CEO Elon Musk will join its board of directors, for starters. As well, Endeavor has laid out a plan to take a 100% controlling interest of the Ultimate Fighting Championship.
Previously, Endeavor had a 50.1% stake of the UFC’s common equity. But per an SEC (Securities and Exchange Commission) filing Wednesday, that will change. As of February 16, 2021, Endeavor entered into a Transaction Agreement other UFC holders that will see the company “directly or indirectly acquire equity interests in UFC Parent,” which will result in Endeavor “directly or indirectly owning 100% of the equity interests of UFC Parent (the “UFC Buyout”).”
Should the deal not go through, however, the existing ownership structure is expected to remain in place.
Back in 2016, when Endeavor purchased the promotion, it partnered up with a number of private equity firms including Silverlake Holdings to pay the $4 billion price tag.
Wednesday’s SEC filing, which mentions the UFC no fewer than 400 times, notes that the promotion had a record year for Pay-per-View sales in 2020. Perhaps surprisingly, given the shift of content to ESPN+ in the United States, Fight Pass subscriptions were up over 40%.
Endeavor previously attempted to go public in 2019, but shelved the idea after a number of factors made the move virtually impossible. The Entertainment company, originally known for talent representation, was at the time embroiled in a dispute with Hollywood screenwriters.
A report by the New York Post previously suggested Endeavor was looking to go public sometime next month. That report broke news of Endeavor’s plan to scoop up full control of the UFC, noting that it was seen as the “crown jewel” of the company’s IPO.
“Buying out the remainder of UFC makes for a better investment,” an industry source told the paper. “The complexity of Endeavor’s business is still there, but the UFC is the crown jewel.”
As to Elon Musk’s involvement, Endeavor pointed to the Tesla, Space X, and The Boring Company chief’s vast experience in the business realm. “Mr. Musk is currently a director nominee and will become a member of our board of directors at or prior to the pricing of this offering. Mr. Musk was selected to serve on our board of directors because of his professional background and experience running a public company, his previously held senior executive-level positions, his service on other public company boards and his experience starting, growing and integrating businesses.”
