By Keith Weir

LONDON (Reuters) - Advertising agency WPP believes that a price tag of up to $2.5 billion for IMG Worldwide is too high to justify a bid for the sports marketing group, CEO Martin Sorrell said on Thursday.

"We would love to own IMG," Sorrell told the Leaders in Football sports industry conference. Asked if WPP was bidding, he added: "No, we can't afford it."

IMG, set up by American sports agent Mark McCormack in 1960, is up for sale after the death in 2011 of owner Teddy Forstmann, who paid $750 million for the business in 2004.

Sorrell said he believes that private equity company Silver Lake and its partner William Morris Endeavor Entertainment are the most likely purchasers but noted strong competition.

"People are talking about 2 to 2.5 (billion dollars). They are talking about 20 bidders, 10 bidders going into the second round. That's nose-bleed territory for us," Sorrell said.

Sorrell estimates that IMG generates annual revenues of about $1.25 billion and core profit of between $170 million and $200 million.

Britain's WPP had been rumoured as a possible buyer, given that it often deals with sports sponsors and rights owners. Sorrell also worked with McCormack at IMG early in his career and is also a director of Formula One motor racing.

WPP, which is set to yield its position as the world's largest advertising agency once Publicis and Omnicom merge, has a market capitalisation of more than 16 billion pounds ($25.5 billion).

However, Sorrell indicated that the level of interest in IMG and the cachet of a company with clients including tennis stars Novak Djokovic and Maria Sharapova had made it prohibitively expensive.

Interested parties include a combination of private equity firms KKR and New Mountain Capital, as well as sports and entertainment company Creative Artists Agency. European investment group CVC Capital Partners is another likely bidder. ($1 = 0.6277 British pounds)

(Editing by David Goodman)

About News.net

Publishing Services International Limited (PSIL) is the publisher and operator of a worldwide network of online news sites dedicated to delivering fair, accurate and relevant reporting from a variety of the world’s most trusted sources – from the biggest cities to the smallest towns.

We deliver positive and powerful messages to our readers, providing up‑to‑the‑second news that matters to the individual.

Our promise is to serve communities and individuals worldwide, delivering information that hasn’t always been available to them. We will give them back a voice – a voice that’s empowering because it is theirs – and provide a platform to communicate between themselves and the world.

We believe people are not just generic demographics; they are individuals with their own preferences and curiosities. We are about understanding these individuals, listening to them, and serving them.

We are the new pioneering spirit of news – we’re not talking to everyone, we’re talking with every one.

If you want your news, your voice, your way, on your time – we’ve got news for you.

 

FAQs

Email

If you have any questions or concerns please email us on support@news.net

Phone

  • Australia, Toll Free 1-800-983-421
  • Hong Kong, Toll Free 800-906-187
  • Singapore, Toll Free 800-852-3871
  • USA/Canada, Toll Free 1-800-830-4132

Advertise With Us

Interested in being awesome?
Contact us by email or phone.

Cancel