The fight between Hollywood writers and talent agencies took a new turn on Friday when the Writers Guild of America blasted plans by the industry’s largest agency for an initial public offering.
Endeavor, owner of the largest of several agencies that have transformed themselves into major Hollywood enterprises, appears to be laying the groundwork for a long-anticipated initial public offering.
The Beverly Hills-based firm, run by Chief Executive Ari Emanuel and Executive Chairman Patrick Whitesell, is considering making its stock-market debut sometime by the end of this year, according to a person familiar with the matter who was not authorized to comment.
A spokeswoman for Endeavor declined to comment.
But the plans, first reported by the Wall Street Journal, brought a swift rebuke from WGA, which has been in the midst of a pitched battle with the industry over practices they see as harmful to their members.
The union said the potential IPO move by Endeavor “only strengthens the call for the conflicted and illegal practices of the major talent agencies to end. It is impossible to reconcile the fundamental purpose of an agency — to serve the best interests of its clients — with the business of maximizing returns for Wall Street. Writers will not be leveraged by their own representatives into assets for investors.”
The move into the production business by the major agencies — including Endeavor, Creative Artists Agency and UTA — has sparked major pushback from the writers. The WGA says the expansion presents a conflict of interest, because agencies will be able to both employ and represent talent. Writers also say that agencies have prioritized fees that they receive for packaging TV and film projects for studios, rather than client representation.
The union is seeking to enforce a new code of conduct for agencies that would effectively end those practices, and has threatened that its members will fire their agents if they can’t reach a new franchise agreement by April 6.
The agencies counter that they can manage any conflicts and that packaging benefits writers because packaged shows have a better chance of being greenlighted by studios.
Endeavor has long been expected to pursue an IPO. The company previously known as WME/IMG has swiftly grown its business through acquisition in recent years, rebranding as a global entertainment concern player not only represents talent but also creates content.
In 2017, WME/IMG changed its name to Endeavor to reflect its broadening ambitions in Hollywood to become a full-fledged media company. That year it launched Endeavor Content to shepherd TV and movie projects.
In 2016, the firm acquired Ultimate Fighting Championship, which has been a lucrative business, for $4 billion. The mixed martial arts league last year signed a $1.5-billion, five-year television-rights deal with Walt Disney Co.’s ESPN. WME bought rival IMG in 2014 for $2.4 billion.
An IPO could benefit Endeavor’s backers, which include the Menlo Park-based private equity firm Silver Lake Partners and the Japanese conglomerate SoftBank.