(Corrects spelling of Forstmann in paragraphs three and four)
By Greg Roumeliotis and Soyoung Kim
Sept 13 Private equity firm KKR & Co LP
has teamed up with New Mountain Capital LLC to bid for IMG,
joining a handful of companies interested in buying the sports,
fashion and marketing agency from Forstmann Little & Co, two
people familiar with the matter said.
KKR and New Mountain would be competing against other buyout
firms in a quest for IMG, as well as entertainment
powerhouses Creative Artists Agency and William Morris Endeavor
Entertainment, which have also been weighing offers for IMG, the
people, who spoke to Reuters this week, said.
While KKR may not have the industry expertise of CAA or
William Morris, its partner New Mountain has deep ties to
private equity firm Forstmann Little.
Steven Klinsky, who founded New Mountain in 2000 shortly
after leaving Forstmann Little, was the most senior partner at
the firm outside of the Forstmann family and worked closely with
Teddy Forstmann, IMG's former chairman and chief executive who
died in 2011.
The sale of IMG, whose clients include top tennis player
Novak Djokovic and supermodel Gisele Bundchen and which owns the
rights to numerous sports leagues, is being driven by the
trustee that runs the estate of Teddy Forstmann.
CVC Capital Partners, another private equity firm that
has significant expertise in sports rights management with
its controlling investment in Formula One, is also involved
in IMG's sale process, people familiar with the matter have said
Initial offers are due in the next few weeks, according to
the people familiar with the matter.
The people asked not to be named because the matter is not
public. KKR declined to comment, while New Mountain did not
immediately respond to requests for comment.
IMG, which Forstmann bought for $750 million in 2004, could
now fetch more than $2 billion in a sale, people familiar with
the matter told Reuters previously.
Forstmann Little has held onto IMG for longer than a typical
investment period for private equity, and for years it has
rebuffed overtures from prospective buyers. Buyout interest
increased following Teddy Forstmann's departure in April 2011 as
IMG chairman and CEO, and his death later that year.
Notable buyers that had approached Teddy Forstmann included
former Yahoo CEO Terry Semel, who was willing to pay $1.5
billion in 2008. Sources told Reuters at the time that Teddy
Forstmann wanted at least twice the amount.
Akin Gump Strauss Hauer & Feld litigation partner Mark
MacDougall and corporate practice co-chair J. Kenneth Menges,
Jr., are managing the wind down of Teddy Forstmann's private
equity empire. The firm tried to exit its investment with 24
Hour Fitness last year but the process has since stalled.
(Reporting by Soyoung Kim and Greg Roumeliotis; Editing by