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Private equity firm TPG ups stake in CAA, becomes majority owner

Creative Artists Agency headquarters
Creative Artists Agency headquarters in Century City.
(Benny Chan / Fotoworks / CAA)

Private equity firm TPG Capital has increased its investment in talent agency Creative Artists Agency, making it the majority owner of the firm that represents such movie stars as Julia Roberts, Brad Pitt and Jennifer Lawrence.

Financial terms of the investment were not disclosed. In a statement, the Century City-based agency said the deal would give it “additional capital and resources for continued growth.”

TPG, based in Fort Worth, acquired a 35% stake in CAA in October 2010. The new investment gives TPG approximately a 53% stake in CAA, according to a person with knowledge of the deal who was not authorized to comment publicly.

In a statement, CAA said its management team will “extend long-term contracts” with the agency. Among the agency’s managing partners are Hollywood power players Bryan Lourd, Richard Lovett, Kevin Huvane and David O’Connor.

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For years the dominant talent agency, CAA is now the second-biggest, trailing rival William Morris Endeavor in size. In December, WME struck a deal to acquire sports and media company IMG Worldwide for $2.3 billion.

WME also is owned by a private equity behemoth: Menlo Park, Calif.-based Silver Lake Partners, whose investments have included Dell and Skype, holds a 51% stake in the Beverly Hills agency.

TPG’s initial investment in CAA four years ago spurred growth of the agency’s CAA Sports arm, which was started in 2006 and counts among its clients Cristiano Ronaldo, Dwayne Wade and Buster Posey.

In addition to representing athletes, broadcasters and coaches -- it has more than 1,000 such clients -- CAA’s sports division advises brands and venues on business opportunities, and has brokered long-term sponsorship deals for Madison Square Garden and Yankee Stadium. 

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A boutique investment bank co-founded by the agency, Evolution Media Capital, specializes in media and sports and has been involved in sports franchise sales, including deals for the Texas Rangers and the Philadelphia 76ers.

“We are excited about expanding the ways we serve clients and taking advantage of countless new opportunities as technology, content, brands, sports and media converge,” CAA said in a statement. “With TPG’s increased investment in our vision, we have never been more inspired by the possibilities that lie ahead.”

In addition to CAA, TPG has other Hollywood investments. The company, formerly Texas Pacific Group, is a backer of a new film studio founded by producer Robert Simonds. 

"[CAA] has had extraordinary growth across its divisions, alongside intelligent asset-building and principal investment strategies, and we are enthusiastic about the continued success ahead,” TPG co-founder Jim Coulter said in a statement.

Follow @DanielNMiller for film business news


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