In a deal announced Tuesday, Kirkland & Ellis is advising Harlem Globetrotters International—which operates the famed Globetrotters barnstorming basketball troupe—in its sale to Herschend Family Entertainment Corporation for an undisclosed sum.
Norcross, Georgia-based Herschend’s existing portfolio of properties includes Dollywood amusement park and Dollywood Splash Country water park in Pigeon Forge, Tennessee—attractions the company runs along with country singer Dolly Parton—as well as Atlanta’s Stone Mountain Park and Silver Dollar City in Branson, Missouri.
Herschend is buying the Globetrotters from Shamrock Capital Advisors, a Los Angeles–based private equity firm cofounded by Roy E. Disney that holds an 80 percent stake in the team. Reuters reported in June that Shamrock planned to put the business up for sale and expected to get between $50 million and $100 million.
The Globetrotters have been entertaining crowds with their signature brand of acrobatic and trick-play-heavy basketball for more than 80 years, playing—and mostly winning—more than 25,000 games around the world, most of them against the hapless Washington Generals and New York Nationals. The team was inducted into the Naismith Memorial Basketball Hall of Fame in 2002 and its many alumni include basketball legends Wilt Chamberlain and Connie Hawkins and baseball Hall of Famer Bob Gibson.
Though details of the agreement were not disclosed, Herschend said the Globetrotters’ management team and player roster will remain intact.
The Kirkland team advising the Globetrotters in connection with the transaction includes corporate partner Damon Fisher and tax partner Russell Light, as well as associates Bryan Ikegami, Ilan Napchan, and Alice Yuan. The firm has advised Shamrock on a number of past deals, including the 2005 acquisition of control of the Globetrotters from former player Mannie Jackson.
Herschend, meanwhile, is relying on lawyers from McKenna Long & Aldridge to provide outside counsel on the transaction. A firm spokeswoman did not immediately respond to The Am Law Daily‘s request for information regarding the firm’s deal team.
SFX Taps Reed Smith for EDM-Tinged IPO
A month after two drug-related deaths shut down an electronic dance music (EDM) festival in New York and created negative publicity for companies that stage such events, one of those companies, SFX Entertainment, is moving forward with plans for an initial public offering.
SFX, which is owned by music entrepreneur Robert F.X. Sillerman, promotes EDM concerts and live events, including the three-day TomorrowLand festival in Georgia this past weekend that reportedly did not suffer any significant problems.
In a filing with the Securities & Exchange Commission last week, SFX priced its IPO between $11 and $13 per share after saying earlier this year that it hopes to raise up to $175 million via the offering. SFX said in last week’s filing that it is aiming to position itself as the largest producer of events focused on what it refers to as “electronic music culture” or “EMC”—a market projected to generate $4.5 billion this year.
SFX is moving to capitalize on EDM’s growing popularity even as the genre’s alleged link to drugs—especially MDMA, also known as ecstasy or Molly—has raised flags in the wake of the deaths at the Electric Zoo festival in New York in August.
In its original prospectus, which was filed in June, SFX said it expected to use some of the proceeds from the planned IPO to complete its acquisition of a majority stake in Made Event, the company behind the Electric Zoo event, as well as on deals for other EDM-focused businesses.
Both that filing and last week’s revised prospectus noted the potential for illegal drug use at its events to expose SFX to legal liability and cause it to suffer financially as a result of drug-related cancellations or revoked licenses; the latter document explicitly cited the Electric Zoo deaths in the section devoted to “risk factors.”
Reed Smith’s Aron Izower is advising SFX on the planned IPO, according to the SEC filings. Izower also represented SFX on its $50 million purchase of Beatport, a music downloading website, in February. White & Case capital markets partners Colin Diamond and Holt Goddard are representing a group of underwriters led by UBS Investment Bank, Jefferies, Deutsche Bank Securities, Stifel, and BTIG.
