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SBJ/January 23-29, 2012/Labor and Agents
Talent firms merge to form Legacy Agency
Published January 23, 2012, Page 1
Genske and his baseball agent partners, Brian Peters and Scott Parker, will be partners at the merged firm, as will Bazant and his partners at The Agency: Andrew Witlieb, Russ Spielman, Peter Raskin and Kevin Canning.
Principe will run the company out of The Agency’s old offices in New York. Genske and the other baseball agents will continue to operate from Legacy Sports Group’s offices in Newport Beach, Calif.
While agency roll-ups in the past have often involved multiple playing-contract sports practices and marketing agencies, by combining two agencies with no competing businesses, Principe said he is hoping to create a more nimble agency without a lot of overlap. “We plan to grow organically through the complementary nature of the two practices, through earnings-enhancing acquisitions and through select events,” he said.
Principe, who got his start in the sports business as a mergers and acquisitions lawyer, helped Robert Sillerman roll up a number of sports agencies to create SFX Sports. He also was the managing director of BEST, which he left in the wake of the firm being acquired by French conglomerate Lagardère Group in early 2010.
The Legacy Agency represents about 225 clients in the United States. Legacy Sports Group brings to the merged firm its contract-representation work for about 100 baseball players. More than 40 of those players are MLB players, including New York Yankees pitcher CC Sabathia and Boston outfielder Carl Crawford. On The Agency side, it brings clients in sports broadcasting, including Troy Aikman; golf, including Jim Furyk; and college coaching. It also has clients for marketing-specific work, including the NFL’s Reggie Bush and Ndamukong Suh.
The merger was finalized last month. While Principe would not discuss specifics about how the deal came together, he said he has known Genske and the principals at The Agency for years.
To facilitate the deal and fuel growth, The Legacy Agency quietly raised about $10 million of debt financing and about $20 million from placing shares in the new agency on the Alternative Investment Market of the London Stock Exchange.
“We went to AIM because it has a successful track record for newly founded companies to raise equity capital,” Principe said.
Institutional investors will own about 70 percent of the company and the principals about 30 percent, a source said.
Principe would not comment on the financial aspects of the deal except to say, “We have institutional shareholders, but it is important to note that the principals, including myself, have equity in the company as well.”
Principe and Genske are part of a five-person management board for The Legacy Agency. Also on the board are Peter Moore, EA Sports president and Electronic Arts COO; Bart Campbell, founder of Global Sports Management Ltd.; and Keith Sadler, group finance director of Digital Marketing Group.
Genkse, Principe and Campbell all have equity in the new firm. Sadler and Moore serve as independent, non-executive directors.
Genske said he had been approached numerous times about business combinations, but those opportunities involved Legacy Sports Group being a small part of a larger agency, with little or no control. “This is different,” he said, “because we remain in control — we at Legacy and the partners at The Agency.”
The Agency and Legacy combined had about 30 employees. All are staying on with the merged company.
The Agency represented athletes off the field but did not represent baseball players. That made it a complementary business to Legacy’s, Principe said. The company does not plan to acquire other sport-playing contract representation practices in the near future, he said.
Principe said that he has learned from his experience building multisport athlete representation practices and that the new company will differ from those endeavors.
“We keep refining the model,” Principe said. “At SFX, we were a mega-agency. At BEST, we were a broad-based, multipractice agency. With [The Legacy Agency], we are limiting the on-field initially to baseball and complementing it with The Agency’s off-field capability in marketing, coaching, broadcasting and golf representation.”