What is the Transaction and what is the total consideration?

TKO Group Holdings agreed to acquire the IMG Media business, Professional Bull Riders, On Location, Mailman, and various events businesses (together, Olympus or the Businesses) from Endeavor Group Holdings for a total consideration of $3.25 billion, based on the 25-trading-day VWAP of TKO PubCo's Class A common stock ending October 23, 2024.

How will the Transaction be consideration paid and how will ownership change?

EDR, the whole owner of Olympus, is expected to receive approximately 26.14 million common units of TKO and subscribe for an equal number of TKO PubCo Class B common shares. The filing states that after closing, EDR is expected to own 59.7% of TKO and TKO PubCo 40.3%.

What do the pro forma financials show for the Transaction's results?

For the nine months ended September 30, 2024, pro forma combined revenue was $3.96 billion and pro forma net loss was $208.0 million, with $75.5 million net loss attributable to TKO. For fiscal 2023, pro forma combined revenue was $3.22 billion and net loss attributable to TKO was $56.2 million. The filing notes these figures are illustrative and not a projection of future results.

Are there financial risks or concerns disclosed for the acquired businesses?

Yes. The Businesses' combined financial statements state that the Parent has experienced recurring net losses and negative operating cash flows, that the Businesses depend on Parent capital investments, and that substantial doubt exists about their ability to continue as a going concern. This is tied to the Parent's $2.2 billion term loan maturing May 18, 2025, with substantially all of the Businesses' assets pledged as collateral.

What costs and risks are associated with completing the Transaction?

TKO expects to incur approximately $50.5 million of transaction costs, primarily financial advisory, legal and professional fees, which are expected to be non-recurring. The forward-looking statements list risks including that the Transaction may not be consummated or may be delayed, that TKO may not realize anticipated benefits, that stockholder litigation may arise, and that regulatory approvals may be delayed or not obtained.

TKO 8-K SEC Disclosure — Dec 13, 2024

01—Abstract

Summary

Summary of the 8-K filed December 13, 2024. Cited figures are marked; the original filing is the authoritative source.

TKO Group Holdings, Inc. filed this Form 8-K on December 13, 2024 to supplement its registration statements and prospectuses with financial information related to its proposed acquisition of the Professional Bull Riders, On Location and IMG businesses (together, the "Businesses") from Endeavor Group Holdings, Inc. The Transaction was previously announced on October 24, 2024.

The filing attaches unaudited pro forma condensed combined financial information, combined financial statements of the Businesses for 2021 through 2023, and unaudited combined financial statements for the nine months ended September 30, 2024, all taken from the Information Statement on Schedule 14C filed December 10, 2024. The pro forma materials describe the Transaction as a total consideration of $3.25 billion^a, based on the 25-trading-day VWAP of TKO's Class A common stock through October 23, 2024. Endeavor's subsidiary EDR is expected to receive approximately 26.14 million common units of TKO and subscribe for an equal number of Class B shares.

The pro forma statements of operations for the nine months ended September 30, 2024 show pro forma combined revenue of $3.96 billion^b and a pro forma net loss of $208.0 million, with a net loss attributable to TKO of $75.5 million. For the year ended December 31, 2023, pro forma combined revenue is $3.22 billion, with a net loss attributable to TKO of $56.2 million. The Businesses' own financial statements include a going concern paragraph.

It cites the Parent's $2.2 billion^c term loan maturing May 18, 2025, and states that substantially all of the Businesses' assets are pledged as collateral to that loan. The pro forma figures are preliminary, present transaction accounting adjustments only (no synergies), and are not intended to project future results. The filing also lists risks including the possibility the Transaction is not consummated or is delayed, the ability to realize expected benefits, and transaction costs of approximately $50.5 million that are expected to be non-recurring.

02—Key points

Key Highlights

Proposed acquisition of the Professional Bull Riders, On Location, and IMG businesses from Endeavor Group Holdings for a total consideration of $3.25 billion.
EDR expected to receive approximately 26.14 million TKO common units and subscribe for an equal number of Class B common shares.
Pro forma combined revenue of $3.96 billion for the nine months ended September 30, 2024, and a pro forma net loss of $208.0 million (net loss attributable to TKO of $75.5 million).
Pro forma combined revenue of $3.22 billion for fiscal 2023, with a pro forma net loss attributable to TKO of $56.2 million.
Post-closing ownership expected to be 59.7% EDR and 40.3% TKO PubCo, per the pro forma notes.
Businesses' combined financial statements include a going concern disclosure tied to the Parent's $2.2 billion term loan maturing May 18, 2025, with substantially all Businesses' assets pledged as collateral.
Expected transaction costs of approximately $50.5 million, described as non-recurring, and no synergies reflected in the pro forma statements.

03—Questions

Frequently Asked Questions

What is the Transaction and what is the total consideration?
TKO Group Holdings agreed to acquire the IMG Media business, Professional Bull Riders, On Location, Mailman, and various events businesses (together, Olympus or the Businesses) from Endeavor Group Holdings for a total consideration of $3.25 billion, based on the 25-trading-day VWAP of TKO PubCo's Class A common stock ending October 23, 2024.
How will the Transaction be consideration paid and how will ownership change?
EDR, the whole owner of Olympus, is expected to receive approximately 26.14 million common units of TKO and subscribe for an equal number of TKO PubCo Class B common shares. The filing states that after closing, EDR is expected to own 59.7% of TKO and TKO PubCo 40.3%.
What do the pro forma financials show for the Transaction's results?
For the nine months ended September 30, 2024, pro forma combined revenue was $3.96 billion and pro forma net loss was $208.0 million, with $75.5 million net loss attributable to TKO. For fiscal 2023, pro forma combined revenue was $3.22 billion and net loss attributable to TKO was $56.2 million. The filing notes these figures are illustrative and not a projection of future results.
Are there financial risks or concerns disclosed for the acquired businesses?
Yes. The Businesses' combined financial statements state that the Parent has experienced recurring net losses and negative operating cash flows, that the Businesses depend on Parent capital investments, and that substantial doubt exists about their ability to continue as a going concern. This is tied to the Parent's $2.2 billion term loan maturing May 18, 2025, with substantially all of the Businesses' assets pledged as collateral.
What costs and risks are associated with completing the Transaction?
TKO expects to incur approximately $50.5 million of transaction costs, primarily financial advisory, legal and professional fees, which are expected to be non-recurring. The forward-looking statements list risks including that the Transaction may not be consummated or may be delayed, that TKO may not realize anticipated benefits, that stockholder litigation may arise, and that regulatory approvals may be delayed or not obtained.

04—Continue

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