Global sports and entertainment giant WME | IMG has announced a cash injection of approximately US$1 billion from the Canada Pension Plan Investment Board (CPPIB) and the Government of Singapore Investment Fund (GIC).
In return, the investment will see the two parties join Silver Lake, SoftBank and Fidelity as the agency’s strategic partners. The agreement, which is expected to close in the middle of this month, was negotiated by Silver Lake and WME | IMG.
According to US magazine Variety, the funds will enable company executives to buy out some minority partners in the Ultimate Fighting Championship (UFC), which WME | IMG acquired for US$4 billion last year, and will allow some of its senior management and investors to cash in their shares immediately.
The cash infusion is also intended to enable further acquisitions as part of WME | IMG’s strategy to accelerate its growth as a global leader in entertainment, sports and fashion. It is also anticipated that the new investment, which incudes other limited partners, will alleviate pressure to go public, something that has been rumoured for some time.
Variety reports that this week's deal values WME | IMG at US$6.3 billion, a marked increase on its 2016 valuation of US$5.5 billion. CPPIB alone has invested US$400 million for an eight per cent stake in the company.
“We’re thrilled to welcome CPPIB and GIC - two leading global investors - to the WME | IMG family as our newest strategic partners,” said Ariel Emanuel and Patrick Whitesell, co-chief executives of WME | IMG, in a joint statement. “We look forward to working with them to continue growing our international footprint and delivering valuable new opportunities to all our clients and partners.”
Ryan Selwood, managing director and head of direct private equity for CPPIB, said: “This investment in a unique market leading platform in entertainment, sports and media further diversifies our portfolio. WME | IMG’s broadly diversified group of global businesses and management team with a proven track record of building shareholder value position the company well for growth, particularly in content production and distribution.
“We are pleased to have another opportunity to invest alongside Silver Lake, a longstanding partner, and WME | IMG’s management to support future growth of the business.”
Eric Wilmes, managing director of private equity at GIC, added: “GIC is committed to supporting WME | IMG’s continuing innovation, industry leadership and international expansion. WME | IMG has demonstrated a capacity to grow and diversify in an increasingly complex environment for sports, entertainment and fashion globally. As a long-term investor, GIC believes the company will benefit from the strong trend of consumers demanding quality content.”