UTA Sells Minority Stake to 2 Outside Investment Groups

Investcorp and PSP Investments become strategic investors in agency

Last Updated: August 7, 2018 @ 12:51 PM

United Talent Agency on Tuesday said that Investcorp and the Public Sector Pension Investment Board (PSP Investments) are now strategic minority investors in the company.

UTA said the new influx of capital from Investcorp and PSP Investments will be used to accelerate its growth, enhance UTA’s existing services, and continue to invest in resources to support its clients and colleagues in a time of change and innovation in content creation and distribution.

Industry insiders suggest that the investment was upwards of $200 million and gives Investcorp and PSP Investments a high 30% stake in UTA.

Over the last five years, UTA has more than doubled in size and in the past year, the company has made acquisitions in live speaking, electronic music, and e-sports and gaming businesses, and has taken an equity stake in Core, recently renamed Industrial Media, which last year relaunched “American Idol.”

“This is a transformative event for UTA. There has never been a greater moment of change and opportunity in our industry for artists, creators and companies like ours,” said UTA CEO Jeremy Zimmer, with UTA chairman Jim Berkus and co-founder Peter Benedek, in a statement. “We were deliberate about finding the right investment partners who recognize UTA as a business that puts clients first, exemplifies a collaborative and diverse culture, and is focused long term on capitalizing on the unique opportunities that disruption and transformation provide. We found that in Investcorp and PSP Investments.”

Investcorp and PSP Investments join existing investor Jeffrey Ubben as UTA’s capital partners. And Zimmer, along with Co-Presidents David Kramer and Jay Sures led the process of choosing the new investors.

Investcorp is a leading provider and manager of alternative investments, with more than $22 billion in assets under management and over 35 years of experience investing globally across a range of industries, including retail and consumer products, business services, technology, real estate, industrials and more. PSP Investments is one of Canada’s largest pension investment managers with assets under management of $119 billion as of March 31 invested across 75 industries and more than 100 countries.

“We are thrilled to have the opportunity to support UTA’s leading franchise and partner again with PSP Investments.  We believe UTA’s client-centric business model has strategically positioned the company to capitalize on the ongoing convergence of talent, content, distribution, and marketing,” Investcorp’s North American head of private equity David Tayeh said in a statement. “Investcorp has been impressed with UTA’s market position, the long-term growth it has enjoyed, and recognizes that its future success will be driven by the continued excellence of its partners in providing superior services for its clients.”

UTA said that its existing executive leadership team of Zimmer, Kramer and Sures, as well as COO Andrew Thau, will remain unchanged. And someone familiar with the deal told TheWrap that UTA plans to disperse some of the money to everyone in the company. Everyone from top-level executives to assistants to mail room clerks are going to get a check, the person said.

“The entertainment industry is experiencing tremendous evolution,” said Simon Marc, managing director and head of private equity at PSP Investments, in a statement. “As demand for high-quality content is greater than ever, UTA is uniquely positioned to benefit from the transformation in the sector. We are excited to partner with Jeremy Zimmer and UTA’s world-class management team and look forward to backing UTA in the next phase of its growth. We also welcome the opportunity to team up once again with Investcorp. Our investment in UTA is a great example of PSP’s ability to partner with top-tier entrepreneurs and like-minded investors.”

UTA was advised on the deal by Moelis & Company and Skadden, Arps, Slate, Meagher & Flom LLP.  Investcorp and PSP Investments were advised by Credit Suisse, Gibson Dunn & Crutcher, and Sidley Austin LLP.

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