01—Abstract
Summary
Summary of the 8-K filed February 28, 2025. Cited figures are marked; the original filing is the authoritative source.
On February 28, 2025, TKO Operating Company, LLC and TKO Group Holdings, Inc. completed the acquisition of the Professional Bull Riders (PBR), On Location and IMG businesses (the Transferred Businesses) from Endeavor Operating Company, LLC and related Endeavor entities, under a Transaction Agreement dated October 23, 2024.
The Transaction Agreement was amended on February 27, 2025 to accelerate the Inside Date to February 28, 2025, remove an automatic extension to April 1, 2025 under certain conditions, and change the timing of employee transfers. Endeavor and its subsidiaries collectively own approximately 61% of the voting interests of TKO PubCo as of the consummation of the Transactions. As consideration, the EDR Parties received approximately 26.1 million TKO Common Units, having an aggregate value of $3.25 billiona based on the volume-weighted average sales price of TKO Class A Common Stock for the twenty-five trading days ending October 23, 2024, with an equivalent number of TKO PubCo Class B Common Stock shares.
The Closing Consideration is also subject to a purchase price adjustment settled in equity of approximately 400 thousand TKO Common Units, valued at $50 millionb on the same basis. These equity securities were issued in private placements exempt from registration under Section 4(a)(2) of the Securities Act.
Concurrently, the parties mutually terminated the Services Agreement dated September 12, 2023 with Endeavor, which had covered services such as content, events, gaming rights, marketing, accounting, employee benefits, information technology and legal support. The filing states that the pro forma financial information required by Item 9.01(b) will be filed by amendment not later than 71 calendar days after the Item 2.01 deadline.
02—Key points
Key Highlights
- Closed the acquisition of PBR, On Location and IMG from Endeavor on February 28, 2025, under the Transaction Agreement dated October 23, 2024.
- Consideration of approximately 26.1 million TKO Common Units, valued at $3.25 billion, plus a purchase price adjustment of approximately 400 thousand units valued at $50 million, all settled in equity.
- Endeavor and its subsidiaries collectively own approximately 61% of the voting interests of TKO PubCo following the Transactions.
- The Transaction Agreement was amended on February 27, 2025 to accelerate the Inside Date to February 28, 2025 and remove an automatic extension to April 1, 2025 under specified conditions.
- The Services Agreement with Endeavor, dated September 12, 2023, was mutually terminated at closing.
- Combined financial statements of the Transferred Businesses are included in Exhibits 99.2 and 99.3 (incorporated by reference from the December 13, 2024 8-K); pro forma information will follow by amendment.
- IMG's acquisition excludes its licensing, models, tennis and golf representation businesses and its full events portfolio, which remain with Endeavor.
03—Questions
Frequently Asked Questions
What did TKO acquire and what did it pay?
TKO acquired the Professional Bull Riders, On Location and IMG businesses from Endeavor. The EDR Parties received approximately 26.1 million TKO Common Units valued at $3.25 billion, plus a purchase price adjustment of approximately 400 thousand units valued at $50 million, both settled in equity.
Who controls TKO after the transaction?
As of the consummation of the Transactions, Endeavor and its subsidiaries collectively own approximately 61% of the voting interests of TKO PubCo.
What changed in the Transaction Agreement before closing?
The First Amendment, dated February 27, 2025, accelerated the Inside Date to February 28, 2025, removed the requirement that the Inside Date automatically extend to April 1, 2025 under certain conditions, and changed the timing of employee transfers.
Were the new TKO shares registered for sale?
No. The equity issued as Closing Consideration was offered and sold in private placements exempt from registration under Section 4(a)(2) of the Securities Act of 1933.
What happens to the existing services arrangement with Endeavor?
The Services Agreement dated September 12, 2023, under which the companies provided each other services including content, events, marketing, accounting, IT and legal support, was mutually terminated on the Closing Date.
04—Continue