Endeavor Officially Withdraws IPO But Leaves Door Open

Endeavor Holdings Group has officially withdrawn the registration of its planned IPO, about three weeks after it halted the launch of the stock on the New York Stock Exchange the same day it was to debut.

In a filing to the U.S. Securities and Exchange Commission on Wednesday, the company requested the “withdrawal of the Registration Statement because it no longer wishes to conduct a public offering of securities at this time.” The company added it “requests that all fees paid to the Commission in connection with the filing of the Registration Statement be credited for future use.”

When Endeavor pulled back the IPO on September 26, the company left open the possibility of revisiting the offering in 2020. There was no other time frames referenced in today’s filing.

Endeavor — whose holdings include talent agency WME, the UFC, sports and fashion management firm IMG and the Professional Bull Riders — had been planning its IPO for months, even down to celebratory signage being printed and prepared for ceremonial unfurling at the NYSE But at the eleventh hour, seeing the various factors converge — including a softening market, shrinking demand from investors — Endeavor and its private equity partners opted to pull the plug.

Conditions have not improved in the weeks since the suspension of the IPO plan. Peloton Interactive shares, which hit the market the day before Endeavor’s planned IPO, are trading about 20% below their offering price of $29. SmileDirectClub, another September IPO, has dropped 50%, joining high-profile miscues from Lyft and Uber in 2019.

Many Wall Street analysts have evinced the theory that investors are more eager for clear signs of profitability or at least a road map for how to get there. Endeavor, while certainly not in the same category as a Silicon Valley startup, carries significant debt and had booked losses in recent quarters, according to recent SEC filings.

Another complication for Endeavor, of course, is its relationship with the Writers Guild of America, which has been aggressively and publicly critical of the IPO amid a broader standoff with the major agencies. While Endeavor has many other components besides its WME agency unit, the knock from writers and others in Hollywood is that the ramping up of Endeavor’s production capabilities means the company has wound up effectively negotiating against itself, a classic conflict of interest.

The company has long said its diversification strategy mitigates any possibility for a conflict.

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