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Volume 22 No. 12
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CAA Sports: New investment will fuel growth

Private investment firm TPG’s increased investment in Creative Artists Agency will provide an even stronger foundation for continued growth of the sports division, CAA Sports co-head Howard Nuchow said.

“We are going to continue to grow as we always have,” Nuchow said last week. “We are going to be smart and strategic. It gives us the ability to continue to hire the best-in-class agents that we have been hiring for the past few years, and it gives us the ability to continue to acquire companies that provide additional internal resources for our clients.”

“We are, 100 percent of the time, looking for good strategic fits for us.”

Howard Nuchow
Co-head, CAA Sports

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TPG and CAA announced last week that the private equity firm had increased its investment in the Hollywood talent firm to a majority position. The companies did not provide specific financial details, but TPG increased its stake in CAA from 35 percent to 53 percent at a cost of $225 million to $250 million, according to reports. TPG, a global private equity firm with $66 billion in capital under management, first acquired a 35 percent stake in CAA in 2010.

Another private investment firm, Silver Lake Partners, joined with rival Hollywood talent agency WME last year to buy IMG.

“There is not an expectation of change, as much as a continuation of all of those things that occurred over the last four years,” Nuchow said. “TPG have been great partners for the past four years, since they invested in 2010. They have brought tremendous resources to the company. They have helped us create new, financially rewarding businesses that complement our existing businesses. They share our vision for growth.”

CAA Sports was launched in 2006, when CAA first hired NFL agent Tom Condon, who counts Peyton and Eli Manning among his clients. Since then, CAA Sports has hired many sports agents and executives, and represents more than 1,000 athletes and sports personalities worldwide across every major sport. The current gross playing contract value for CAA Sports athlete clients exceeds $5.5 billion, more than any other agency. As previously reported, CAA Sports had the most first-round picks this year in all the major team sports — the NFL, NBA, NHL and MLB — a first for any agency.

In recent years, after building a strong athlete representation practice, CAA Sports expanded into other sports businesses, including corporate consulting and property sales.

CAA Sports’ property sales group has completed $3 billion in new sales, including selling the naming rights for Levi’s Stadium last year. That business is growing not just in the U.S. but globally, Nuchow said.

In June, CAA Sports announced that it had been retained by AS Roma to bring to market the global naming rights and corporate partnerships for the club’s sports and entertainment complex being built in Rome and set to open in 2016.

CAA Sports launched a consulting business in 2011, when it hired longtime corporate consulting executive Greg Luckman. Nuchow said that business continues to grow, as well. “We are in consulting and we have grown that business 411 percent in the past year, in revenue,” Nuchow said.

Also, since the beginning of this year, CAA Sports has made three acquisitions to complement its existing sports business lines. CAA Sports acquired golf corporate consulting firm PGM and corporate hospitality firm Inside Sports & Entertainment Group in February. In June, CAA Sports bought experiential marketing company PGW.

Since then, PGW has added clients from CAA Sports’ consulting client base, PGW founder Russ Jones said.

It was anticipated that some of PGW’s clients would also become CAA consulting clients when the acquisition was announced in June, and Jones said, “That is something that is integrating as we speak,” although he could not name the brands. “In a nutshell, we are going through the roof right now,” Jones said. “Business is flourishing.”

Nuchow wouldn’t say whether CAA Sports was close to announcing any more acquisitions or executive hires. But he said, “We are, 100 percent of the time, looking for good strategic fits for us. So, 100 percent of the time, we are growing, always looking for new fits for our clients, to grow every one of these businesses that we have formed.”