IMG Academy for ... 1.25bln?????
At this point I don't know what to think in this market -
How is IMG Academy - a sports school - worth 1.25bln
I haven't heard much about EQT except for their owning Nord Anglia Education (which is run by some of the most incompetent and rude people I have ever had the misfortune to meet). Even with the potential synergy I don't see how this is a real strategic play?
Either I'm missing something about this move or our industry is in a really bad spot when we start paying Mickey-Mouse money for an acquistion off of a weak vendor (looks to me like Endeavour had to sell before WWE merger) for a school which I could not doing over 150mil in revenue and 20? 30? in EBITDA, especially with rate rises coming.
Maybe I don't know what I'm talking about but I really can't understand this deal.
They do close to $300M in top line.
Maybe not as bad a deal as I thought
I probably still wouldn't have paid over 800mil if its doing 50 in EBITDA especially how tight the market seems right now but I guess if they had cash to burn and a mandate in education then they probably know better than me.
If I had to guess it's not about the education but the NIL money that is flowing into the school's sports programs. IMG Academy recruits (buys) the most promising talent - especially in football - and basically grooms all of them to become top college prospects. With college players now allowed to make money off their likeness (I think since 2021 now?) they will become their own small media companies earlier and earlier. Some of these athletes are worth >$5mm individually by their second year in college. Jaden Rashada is a highschooler who just signed the biggest NIL deal to date of $9.5mm. There is even the trend going where college athletes try to milk their NIL earnings as much as possible during their college years because they don't really expect to make it to the pros. All qualitative conjecture but if I had to guess, with Endeavor being involved, this was a large part of that.
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