Four Am Law 100 Firms Take Star Turns on WME's IMG Buy
At least four Am Law 100 firms have grabbed lead roles on the sale of global sports talent, media and marketing giant IMG Worldwide to rival William Morris Endeavor Entertainment and private equity backer Silver Lake Partners.
While the terms of the deal announced Wednesday were not disclosed, multiple reports pegged its value at north of $2 billion, with Bloomberg putting the winning bid at $2.4 billion. WME and Silver Lake landed IMG by besting several rival bidders in an auction set up by current owner Forstmann Little & Co., the private equity firm now liquidating its portfolio following the November 2011 death of cofounder Theodore Forstmann.
“Today marks the successful culmination of the bold global strategy devised by Ted Forstmann for IMG over many years,” said a statement by Akin Gump Strauss Hauer & Feld litigation partner Mark MacDougall. The Am Law Daily reported last year on how MacDougall—whom The American Lawyer once dubbed "The Cleaner" for his skills in reputation management—and Akin Gump had snagged the lead role of winding down Forstmann’s private equity empire, thanks in part to the billionaire's friendship with name partner Robert Strauss.
“We would like to thank the board of directors, the leadership team and all of the employees of IMG for all that they have done to bring us to this day,” added MacDougall, who was named to IMG’s board by Forstmann in 2011 as the private equity pioneer sought to preserve a succession plan he had for the company while battling terminal brain cancer. “We are confident that [IMG] will continue to flourish and grow under the leadership of Silver Lake and WME.”
J. Kenneth Menges Jr.—cohead of Akin Gump's corporate practice and managing partner of the firm's Dallas office—has been working with MacDougall to liquidate Forstmann Little’s remaining assets, which, with the IMG sale, now includes only the 24 Hour Fitness health club chain.
“While it’s not unusual for longtime clients to resolve themselves, this deal was particularly interesting because of IMG’s sex appeal,” Menges says. “We had well over 100 interested parties when this process began, and [financial advisers Evercore and JPMorgan Chase] did a great job of whittling down the winners.”
The other bidders vying to acquire IMG included a consortium of ICM Partners and private equity giant The Carlyle Group, as well as CVC Capital Partners and Chernin Entertainment, a media investment company owned by former News Corp. executive Peter Chernin. KKR dropped out of the bidding in November. (Sources say Gibson, Dunn & Crutcher counseled CVC Capital on its offer, while Debevoise & Plimpton advised ICM/Carlyle.)
Other Akin Gump lawyers advising IMG on the proposed sale to WME include corporate partner Robert Dockery, corporate counsel Nancy Sarmiento, employee benefits counsel Michael Gerald and associates Matthew Bivona, Julie Feldman and Andrew Tran. Constance Robinson, head of the antitrust practice at Kilpatrick Townsend & Stockton, is serving as regulatory counsel to IMG and Forstmann Little. Menges praises longtime IMG general counsel John Raleigh as an “indispensable” member of a deal team that also included the agency's vice president of legal Jackie Simpson and associate counsel Manu Nathan.
IMG's in-house and outside lawyers were tasked with finding a new home for the Cleveland-based company founded in 1960 after late lawyer and sports agent Mark McCormack made a handshake deal with golf legend Arnold Palmer.
A Yale Law School graduate who saw that professional athletes could make big money via endorsement deals and sponsorships, McCormack was crowned “The Most Powerful Man In Sports” by Sports Illustrated in 1990. And in the years since he signed Palmer as a client, McCormack, who died in 2003, helped build the company now known as IMG into a global powerhouse with offices in London, Miami, Nashville and New York.