Billionaire François-Henri Pinault nears $7bn deal for CAA (report)

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Francois-Henri Pinault

François-Henri Pinault, a French billionaire whose family is behind the Kering group, is nearing a $7 billion deal to buy a majority stake in Los Angeles-based Creative Artists Agency (CAA).

That’s according to a Bloomberg report from Wednesday (August 30), which, citing people familiar with the matter, says that Pinault is looking to buy the majority stake in the talent agency held by private equity firm TPG Capital.

The news outlet first reported on the talks for a deal in July. But sources at the time said that talks for a majority stake in TPG-backed CAA ‘could still end without an agreement’.

TPG acquired a 35% stake in CAA in 2010 and subsequently increased its holding to 53% in 2014.

Most recently, citing sources, Bloomberg reported that Singapore government investment arm Temasek Holdings could also boost its stake in CAA by buying out the shares held by China’s CMC Capital.

Temasek secured a minority stake in CAA in September 2017 and has also previously invested in SoundCloud.

According to the report, the parties are anticipated to wrap up negotiations within the next couple of weeks, although the deal could still ‘fall apart’.

As noted by Bloomberg, the projected $7 billion valuation of CAA marks an increase from the $5.5 billion assigned to the agency the previous year during its acquisition of rival agency ICM Partners. 

The move by Pinault seeks to secure a share in one of Hollywood’s ‘most stable and powerful institutions,’ Bloomberg’s report said, even amid a ‘challenging time for media deals’ as the sector contends with the decline of pay TV, rising interest rates, and industry disruptions caused by writer and actor strikes.

Earlier in August, Deadline reported that CAA has implemented a round of layoffs affecting about 60 employees across the company’s various divisions.

The workforce adjustment is said to be a culmination of a months-long evaluation process that preceded the Writers Guild of America’s strike action on May 2. 

However, Bloomberg said the Pinault family views CAA as a strategic means to ‘invest in the value of celebrities’, and may leverage their fame to enhance the company’s other businesses.

The Pinault family is the biggest shareholder in the Kering group, which owns luxury brands and fashion houses from Gucci, to Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni, Boucheron, Pomellato, DoDo, Qeelin, as well as Kering Eyewear.

Kering parent company the Artemis Group was set up as the Pinault family’s investment vehicle in 1992 and counts assets such as Christie’s auction and publishing house Editions Tallandier.

It also owns a stake in sports brand Puma and has made investments in Deezer and ByteDance.

Meanwhile, CAA, founded by partners including Michael Ovitz and Ron Meyer in 1975, represents a range of talent in film, television, music, theatre, video games, sports, and digital content. It also represents some of the biggest global touring artists in the music industry.

With its headquarters situated in Los Angeles, CAA also holds a presence in New York, Nashville, London, Beijing, and Shanghai. The agency also maintains operational offices in various other global locations, including Atlanta, Charlotte, Chicago, Dallas, Denver, Geneva, Jacksonville, Las Vegas, Memphis, Miami, Munich, Orlando, Stockholm, and Toronto.

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