The deal, which also creates a $500m investment fund, is expected to help the Hollywood agency expand. Agency’s four managing partners commit to stay on.
In a move that is expected to help the Hollywood talent agency expand further into sport and other businesses, Creative Artists Agency (CAA) has sold a non-controlling 35% stake to private investment firm TPG Capital. The companies have also committed to create a $500 million fund for future investments.
The value of TPG’s investment was not disclosed but reports have suggested that the infusion is in the hundreds of millions of dollars.
CAA’s managing partners - Bryan Lourd, Kevin Huvane, David O’Connor and Richard Lovett - have made long-term commitments to continue leading the agency.
The deal is being seen as an important step for CAA as it expands into new businesses and faces competition from new Hollywood talent giant WME Entertainment. Over the past four years, CAA has entered the sports business, created media and sports investment bank Evolution Media Capital, developed a digital media practice and expanded internationally.
In a statement, the agency’s managing partners said: “CAA exists for one reason - our clients. Our new relationship with TPG will help us continue to build momentum in the work we do for clients every day. With TPG’s experience and resources, this could be accomplished through capital investments that build upon our full-service platform, new business leads developed through TPG’s extensive worldwide relationships, expert insight on the international marketplace, and a myriad of other ways.”
Agency president Lovett added, “We have known and respected the leaders of TPG for a long time, and believe this strategic partnership marks a new starting point for the agency’s future.”
TPG is one of the world’s leading private investment firms, with more than $47bn under management across a variety of industries. It is part of the partnership that bought MGM in 2004 and is now trying to restructure the struggling studio.
TPG founding partner David Bonderman said in the statement: “Over its history, [CAA] has demonstrated a consistent ability to identify nascent opportunities and expand into new markets. CAA’s outstanding management team has built the gold-standard franchise in their industry based on a culture of exceptional client service, and we look forward to supporting CAA at this exciting inflection point in their evolution as they look to expand their operations and services around the globe.”