IMG|WME in Financial Trouble, Miss Universe Pageant Survival in Question

The Miss Universe parent company Endeavor, suffered another setback as its credit ratings has been downgraded to a “substantial risk”.

Endeavor, formerly IMG|WME, has its S&P credit rating lowered. It has been downgraded from B to CCC, which means that the company is currently vulnerable and is dependent upon favorable business, financial, and economic conditions to meet its financial commitments. The credit rating agency also changed the company’s outlook to negative.

S&P Global Ratings (previously Standard & Poors) is an American credit rating agency that publishes financial research and analysis on stocks, bonds, and commodities. S&P developed the standard rating scale used to rate both short- and long-term debt.

HAIL ARI FULL OF DEBT

Endeavor currently has an astonishing $4.6 billion in long-term debts and overall liabilities totaling $7.2 billion. With a large chunk of its business is on live events like the Miss Universe pageant, the current coronavirus pandemic puts it in a more precarious state that it has raised questions about Endeavor’s ability to survive.

Earlier in March it already laid off around 250 staff that worked at positions that could not transition to remote roles. And more job losses are coming. The company is also rolling out pay cuts that will apply across all of Endeavor’s holdings, including IMG, the Miss Universe Organization and Professional Bull Riders. The pay reductions will proportionately increase according to base salary, from 5% to 30%. The Endeavor group is thought to employ between 7,000 and 7,500 staff all over the globe.

Endeavor heads Ari Emanuel and chairman Patrick Whitesell are forgoing their salaries, with president Mark Shapiro cutting his in half. The heads were supposed to receive a base salary of $4m, while Ari Emanuel was due an annual bonus of up to $6m and Patrick Whitesell $2m.

Endeavor’s operations are split into three main divisions: Entertainment, Sports and  Fashion(including rights trading); Representation (of talent); and Endeavor X (the direct-to-consumer and business-to-business streaming services).

SASHES&SCRIPTS’ TAKE
How will this news impact the Miss Universe organization? Here are what we speculate:

  1. Lesser Manpower for the Org – with layoffs and furloughs in the news, it will be no surprise that the pageant will have to make do with lesser manpower to manage the daily activities of the organization. It is likely that the ‘trimming of the fat’ begun last year and has continually done so this year. Pay cuts among its high ranking officials are also not far behind.
  2. Possibility of selling up the pageant – the rumor of having the pageant sold again to a different owner just wouldn’t die down. We have heard about this rumor since 2019 and with the current financial state of Endeavor, it’s an option for survival. Now, one of the rumors circulating in Latin pages is the possibility of the Trump family buying back the pageant. It is said that it would all boil down after the US elections in November if current US President Donald Trump would win over his re-election bid.
  3. A Stronger reason not to postpone the pageant – we speculate that the current financial situation of Endeavor would push for the MUOrg to have its pageant this year. After all, its biggest income generator is still the annual pageant. This is why our insiders insisted that the pageant would have to happen by December of this year.

What do you think of this news and the rumors surrounding the survival of the Miss Universe pageant? Let us know on the comments below…

SOURCES:
* https://www.sportbusiness.com/news/endeavor-lays-off-250-staff-with-more-cuts-to-come/
* https://www.thewrap.com/endeavor-wme-debut-fall-hollywood-heights-ari-emanuel-patrick-whitesell/
* https://variety.com/2020/biz/news/endeavor-pay-cuts-ari-emanuel-patrick-whitesell-1203551733/
* https://www.forbes.com/sites/mikeozanian/2020/04/13/endeavor-gets-credit-rating-lowered/#43c48b3061f6
* https://www.hollywoodreporter.com/news/endeavor-plans-lay-offs-furloughs-pay-cuts-one-third-employees-1291367

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