After the passing of owner Ted Forstmann in 2011, rumors started circling that IMG was going to put up for sale. Forstmann-Little, the company that owns IMG, kept coy about the powerhouse agency’s future for a long time, but now it’s well and truly on the market.
IMG is synonymous with the birth of the athlete representation industry. Started in 1960 with a handshake between founder Mark McCormack and golfer Arnold Palmer, the agency has grown to arguably one of the biggest sports management companies in the world. Over the years they have diversified in to fields including events and the lucrative college market.
Bidding began late last month, with approximately 24 interested parties submitting bids. The company is looking to fetch somewhere between $2 and $2.5 billion. Their last annual results reported a profit of approximately $200 million, which puts their earnings to Price to Earnings Ratio of around 12 to 1.
Earlier this week the company narrowed the search down to 10 for the second round. Parties that made the cut include other representation firms including CAA and WME (both backed by private investment companies), media magnate Peter Chernin, and a host of other private firms.
However it appears the list is actually much shorter than this. Speaking at the Leaders Sports Summit in the UK, WPP CEO Sir Martin Sorrell says that the likely winner will be WME. WPP were in the bidding process, but did not proceed to the second round with Sorrell pronouncing that the bidding area is entering nose-bleed territory for them.
Forstmann-Little hope to have a deal done by Thanksgiving.