NEW YORK (CelebrityAccess) — Endeavor has lowered its sights for its upcoming IPO, reducing both the number of shares that will go on sale and the price it expects those shares to sell for.
In an amended filing with the Securities and Exchange Commission on Thursday, Endeavor estimated that the initial public offering price per share will be between $26.00 and $27.00, which is lower than the $30 to $32 estimate from last week.
Endeavor also reduced the number of shares it will offer for sale in the IPO from 19.4 million to 15 million.
“Our Chief Executive Officer, Ariel Emanuel, and our Executive Chairman, Patrick Whitesell, and their affiliates, together with affiliates of Silver Lake Partners will hold a majority of our issued and outstanding Class Y common stock, Class X common stock and, in the case of affiliates of Silver Lake Partners, Class A common stock after this offering and, as a group, will control more than a majority of the combined voting power of our common stock. As a result, they will be able to control any action requiring the general approval of our stockholders, including the election of our board of directors, the adoption of amendments to our certificate of incorporation and by-laws and the approval of any merger or sale of substantially all of our assets,” Endeavor said in the filing.
Endeavor, following the 2009 merger with the William Morris Agency, has, through acquisitions, grown into a sprawling entertainment company. Notable buys include the 2014 acquisition of sports and modeling giant IMG Worldwide, and the 2016 purchase of a controlling interest in Zuffa Parent, the owner of the Ultimate Fighting Championship mixed martial arts league.
However, as noted in an analysis earlier this week by The Motley Fool, it is difficult to assess how profitable Endeavor is behind all of the acquisitions. According to the Motley Fool, there are “significant gaps” between the company’s earnings according to generally accepted accounting principles and what the company states its adjusted earnings and EBITDA are.
As Motley Fool noted, Endeavor reported adjusted net income of $100 million in 2018 but when the company’s $150 million in stock-based compensation was almost, and amortization of intangibles are considered, it turns that adjusted figure into a $350 million loss.
The Motley Fool analysis also showed that Endeavor was carrying a debt load of $4.6 billion as of June 2019. In its SEC filing, Endeavor noted that it plans to used$ 361.6 million of net proceeds to repay $325 million of debt obtained in 2014.