On Tuesday, Endeavor Group Holdings, Inc. ( EDR ) entered into an agreement to be acquired by private equity company Silver Lake alongside Endeavor management and other anchor investors.

With branches across North America, Europe and Asia, Silver Lake’s portfolio companies collectively generate nearly $258 billion of revenue annually

Endeavor shareholders are set to receive $27.50 per share in cash, marking a 55% premium to the unaffected share price of $17.72 per share on October 25, 2023, and a 39% premium to Endeavor’s unaffected 30-day VWAP.

October 25, 2023, is the last full trading day before Endeavor announces its review of strategic alternatives.

Endeavor’s acquisition entails an equity value of $13 billion, offering shareholders a ‘significant premium,’ per a press release.

As part of the agreement, TKO Group Holdings, Inc. ( TKO ) , of which Endeavor is the majority owner, will remain a publicly traded company that will continue to benefit from its connectivity to Endeavor’s expertise.

“Together, we have built and grown Endeavor from $350 million in annual revenue when we first invested in 2012 to nearly $6 billion in consolidated revenue today,” Egon Durban, Co-CEO and Managing Partner of Silver Lake and Chairman of the Board of Endeavor, said. 

Silver Lake anticipates that consolidating TKO’s value into Endeavor will result in a combined enterprise value of $25 billion, marking the largest private equity sponsor public-to-private investment in over a decade and the largest ever in the media and entertainment sector.

On the unaffected date, the equity value stood at $8.2 billion. Silver Lake’s premium amounts to an additional $4.6 billion in equity value for all Endeavor stockholders.

The premium offered to Endeavor stockholders surpasses the median premium, typically in the low-to-mid-30% range, observed in private equity sponsor take-privates exceeding $10 billion in enterprise value across the technology, media, entertainment, and telecommunications sector over the past five years.

Ariel Emanuel, CEO of Endeavor, said: “We believe this transaction will maximize value for all of Endeavor’s public stockholders and are excited to continue to unlock and invest in the growth opportunities ahead as a private company.”

The transaction is slated to conclude by the end of the first quarter of 2025. After finalization, Endeavor’s common stock will cease to be listed on any public market.

Price Action: EDR shares are trading higher by 0.26% to $25.93 premarket on the last check Wednesday.