Endeavor Sells IMG Academy for $1.25B to Asian Private Equity Fund
Endeavor Group Holdings is selling sports-focused educational brand IMG Academy for $1.25 billion to Asia-focused private equity fund BPEA EQT, which will fold the academy into its educational division.
Endeavor recently began listening to offers for IMG Academy after having rejected multiple inquiries in past years, Sportico reported in March. The sale to private equity comes on the heels of Endeavor’s acquisition of WWE and its plan to spin its UFC division into a separately traded company.
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“We weren’t in the market looking to sell IMG Academy; we were proactively approached from the outside with such a significant offer that we had a duty to listen,” Endeavor president and chief operating officer Mark Shapiro said on a phone call Tuesday. “That month-long process resulted in this sale with not only an incredible financial transaction for Endeavor, but also we’re landing IMG Academy [with an] ideal steward to protect its life legacy and grow its fortunes.”
IMG Academy is a sports-focused boarding school in Bradenton, Fla., which also operates sports camps and online coaching. Additionally, it supports college recruiting efforts, having placed about 30,000 athletes into college rosters last year. The sale price for the academy alone is half the total Endeavor paid to acquire IMG, primarily a sports and entertainment representation business, in 2014.
IMG Academy’s buyer is a $22 billion asset manager formed by the October combination of two businesses: Baring Private Equity Asia and EQT Asia. BPEA EQT owns Nord Anglia Education, which operates 82 schools with 75,000 students worldwide, including ones in partnership with performing arts school Juilliard, MIT and UNICEF. The addition of IMG Academy, which draws its largest segment of international students from Asia, will further BPEA EQT’s ambition to expand its educational offerings in markets including Singapore, India, Vietnam, China and Indonesia.
The acquisition means BPEA EQT’s Private Equity Fund VII is now about a quarter invested, according to a release from the fund Tuesday. The right to continue to use the IMG Academy brand also comes with the purchase.
For Endeavor’s part, Shapiro stresses the deal is unrelated to the acquisition of WWE, given that deal greatly reduces Endeavor’s overall debt leverage and provides the company another cash-generating arm. The sale also doesn’t indicate any shift in Endeavor’s plans, since the educational operation was a non-core operation of the sports and entertainment conglomerate, according to Shapiro. The high sale price and the strong valuations in Endeavor’s other recent deals shows that the publicly traded company should be valued more robustly by investors, he added.
“The story of Endeavor and IMG Academy is a paradox,” Shapiro said. “On the one hand, it shows how valuable our assets are. On the other hand, it shows how undervalued our collection of assets are. We have industry leading assets that don’t get full credit from the street in terms of their value.”
(This article has been updated in the fifth paragraph with the correct number of students for Nord Anglia Education.)
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