11:39 AM EDT, 10/24/2024 (MT Newswires) -- TKO Group ( TKO ) , the parent of fighting brands UFC and WWE, announced a deal on Thursday to buy three sports assets from Endeavor (EDR) for $3.25 billion in an all-equity transaction.

The deal includes the Professional Bull Riders league, sports hospitality company On Location, and sports content distributor IMG. The assets will expand TKO's operational footprint in the premium sports market and enable "direct participation in the upside from partner leagues and events," the company said.

Sports and entertainment company Endeavor, already the majority owner of TKO, will receive roughly 26.14 million shares of TKO Operating Co., and subscribe for an equal number of class B shares. Endeavor's ownership in TKO is expected to climb to 59% upon completion of the transaction, with existing TKO investors owning the remaining 41%.

"PBR, On Location, and IMG are industry-leading assets that meaningfully enhance TKO's portfolio and strengthen our position in premium sports globally," TKO Chief Operating Officer Mark Shapiro said in a statement. "Within TKO, they will help power the growth of our revenue streams and position us to capture even more upside from some of the most attractive parts of our sports ecosystem: media rights, live events, ticket sales, premium experiences, brand partnerships, and site fees."

The transaction is expected to close in the first half of 2025, subject to regulatory approvals. Shares of TKO tumbled 7.4% in Thursday trade, while Endeavor was down 1.4%.

Endeavor said in a filing on Thursday that the transaction is also subject to a "pre-closing restructuring" and the absence of a "business material adverse effect."

Private equity firm Silver Lake announced plans in April to buy Endeavor in a take-private deal with an equity value of $13 billion. When consolidating TKO's value into the deal, the acquisition was valued at $25 billion, making it the largest private equity sponsor public-to-private investment transaction in over a decade, according to a statement at the time. That deal was scheduled to complete by the end of the first quarter of 2025.

TKO also announced Thursday a $2 billion share repurchase program and initiated a quarterly cash dividend.

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