CAA Plans to Refinance Debt, Buy Back Roughly $400 Million Worth of Employee Shares

The majority of CAA’s 2,000 and some staff do not have equity stakes in the agency

Creative Artists Agency, one of Hollywood’s top talent agencies, is looking raise a little over $1 billion it would use to refinance some of its debt and buy back employee shares, sources with knowledge of the situation told TheWrap.

The deal, which CAA hopes will come together in the next few weeks, would allow the company to refinance $757 million in debt it currently holds. Essentially, instead of paying back $757 million, CAA would have more favorable terms under which to pay back the $1.15 billion it is looking to raise.

Representatives for CAA declined to comment.

CAA would use the remainder of the $1.15 billion it’s using to refinance — some $393 million — to buy back minority stakes of employee shares. Sources told TheWrap CAA would only offer to buy back employee shares, which they’re not obligated to sell, and not shares held by institutional investors.

CAA is likely taking advantage of market that at the moment allows companies to borrow money easier and under more favorable terms. Typically, buying back shares is a show of health of the company and a way to reward the company’s top earners.

Current CAA stakeholder TPG is arranging the financing deal for the agency, along with Bank of America, Credit Suisse, UBS and others.

CAA’s Bryan Lourd, Richard Lovett and Kevin Huvane will have the opportunity to sell a minority of their shares. The majority of CAA’s 2,000 and some staff, however, do not have equity stakes in the agency.

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