SBD/December 11, 2012/FinancePrint All
Private equity firm Forstmann Little & Co. is “preparing to put its powerhouse sports agency IMG Worldwide up for sale next year,” and the sale “could fetch as much as $2 billion,” according to sources cited by Rachel Abrams of DAILY VARIETY. Sources said that Goldman Sachs has been “informally helping Forstmann prep IMG for a sale.” It is unclear whether the investment bank “has officially signed on to shop IMG, but the firm has deep ties to Forstmann Little.” Still, IMG Senior VP/Corporate Communications Jim Gallagher said that the company “is not for sale.” Abrams wrote IMG is “seen as a marquee asset with unique infrastructure in the sports event world.” A source said that Forstmann Little, which acquired IMG in ‘04, “quietly shopped the asset earlier this year for about $3 billion.” IMG's global operations include “robust sports marketing, event management, licensing, fashion, representation and production businesses.” It handles “retailing and licensing for the All England Lawn Tennis Club, which organizes the Wimbledon tennis tournaments, and produces high-end golf, soccer, rugby and cricket events around the world, among its other sports activities.” IMG's competitors in the sports business “include CAA and the Wasserman Media Group.” CAA, with its “growing sports ambitions, is seen by industry observers as a likely bidder for the asset.” Some believe that CAA's “private equity investor TPG could eye IMG as a potential acquisition to pair with the agency.” Observers have suggested that private equity firm Guggenheim Partners and India-based Reliance -- which already has a partnership with IMG -- “could also be in the mix” (VARIETY.com, 12/10).
Wasserman Media Group "has expanded both its consulting business and its Canadian presence with the acquisition of Catalyst Sponsorship Consulting, a Toronto firm with golf expertise and relationships with large Canadian companies," according to Terry Lefton in this week's SPORTSBUSINESS JOURNAL. Catalyst is an "18-person firm started by former Bell Canada sponsorship director Steve Marshman" in '05. WMG Managing Dir Malcolm Turner said, “He knows how to use golf as a marketing platform as well as anyone, and his relationships in Canada are deep.” Marshman will now report to Turner. WMG Chair & CEO Casey Wasserman "noted that his firm had worked with Marshman for a few years and therefore knew it could be a successful acquisition." Wasserman said, “Mergers and acquisitions fail much more often because of people and silos than they do because of financial reasons. This fits culturally and geographically” (SPORTSBUSINESS JOURNAL, 12/10 issue). SCOREGOLF.com's Rick Young wrote in "standard business terms, this is a huge power play." While the news "might not resonate with the general golfing populace I can assure you this late season development is a significant one for the Canadian golf industry and beyond." Among the most notable corporate clients for Catalyst are "Royal Bank of Canada (RBC), CN Rail, Manulife Financial and Bell." In '07, Catalyst "advised RBC on the bank’s first foray into golf and helped develop its global golf sponsorship portfolio and brand ambassador program." The agency "most recently executed RBC’s programming" as the official bank of the PGA of America at the '12 Ryder Cup and '12 PGA Championship (SCOREGOLF.com, 12/10).