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Endeavor lays off 250 staff with more cuts to come

Endeavor, the talent agency and sports and entertainment group that owns sports marketing agency IMG, has laid off around 250 staff as the sports and film industries continue to be on shut down amid the global spread of the Covid-19 pandemic.

This first round of cost cutting mainly affects operational staff unable to work from home and chiefly those at IMG Academy, the agency’s sports and educational performance unit.

However, an internal memo sent by Endeavor chief executive Ari Emanuel notified staff that more job losses would be coming.

The memo, seen by SportBusiness, read: “In addition to the cost-cutting efforts outlined a few weeks ago, we will be implementing a number of additional measures beginning this week and through April that will affect compensation and some jobs across the company.

“The effects on each business will vary, and you will receive more specifics from your respective leaders, to the extent any of these decisions may impact you.”

Emanuel said that “all parts of our company” are feeling the effects of the global Covid-19 crisis.

Emanuel and Patrick Whitesell, Endeavor’s executive chairman, are to give up the remainder of their 2020 salaries. The duo were each due to receive a base salary of $4m (€3.6m), while Emanuel was due an annual bonus of up to $6m and Whitesell $2m.

The Endeavor group is thought to boast between 7,000 and 7,500 staff overall.

Along with IMG, which Endeavor acquired for $2.3bn in 2013, assets held by the group include the WME talent agency, mixed martial arts’ UFC, Professional Bull Riders and the Miss Universe Organization.

Endeavor pulled its initial public offering six months ago. At the time, Endeavor was carrying $4.6bn in debt. The calling off of the IPO is thought to have left senior WME agents frustrated as they missed out on a proposed windfall.

Unrelated to the impact of the coronavirus outbreak, there was a high-level restructuring at IMG after the pulling of the IPO.

In November, IMG announced that Adam Kelly had been promoted to co-president of the renamed ‘IMG Media & Events’, sitting alongside Sam Zussman. Kelly was promoted as Ioris Francini relinquished his position as president of IMG Media (albeit staying on board in a chairman capacity).

Endeavor has continued to be acquisitive since stepping back from the IPO.

At the turn of the year, it acquired a majority stake in premium hospitality company On Location Experiences in a deal worth $660m. Endeavor also recently agreed a deal to buy a minority stake in SailGP, the team sailing competition founded and financially backed by Oracle billionaire Larry Ellison. That deal valued the series at $200m.

In August 2019, Endeavor reported first-half revenues of $2.05bn and adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) of $249.7m, as the effect of a trio of hefty football media-rights contracts was felt. The financial results, as reported by SportBusiness, particularly highlighted the impact of IMG’s international media-rights distribution deals for Serie A, LaLiga and the FA Cup, with all three contracts beginning at the start of the 2018-19 season.

Endeavor’s operations are split into three main divisions: Entertainment and Sports (including rights trading); Representation (of talent); and Endeavor X (the direct-to-consumer and business-to-business streaming services).