CAA

Private Equity Manager (GP)

Case study

About the company

Creative Artists Agency (“CAA”) is a talent and sports agency based in Los Angeles, California.

The agency represents clients in the entertainment, media and sports sectors including thousands of the world’s leading actors, directors, athletes, musical artists and broadcasters.

The company was founded in 1975 and employs more than 3,000 people across 25 countries.

Investment rationale

• This was a compelling opportunity to invest in a top agency platform in a market that offers pure play exposure to the media and entertainment sector.
• CAA has enjoyed strong customer and agent retention historically, and has a track record of net client wins against the competition. The only capex needs of the business are leasehold improvements and IT equipment, which account for less than 2% of revenues.
• The business is asset-light with recurring revenues and strong cash conversion. Furthermore, CAA has a highly diversified and stable revenue mix.
• The company performed resiliently through the COVID-19 pandemic and regained strong momentum following the lifting of restrictions.

Our relationship

TPG was founded in 1993 and is a high-quality US buyout manager with whom Pantheon has a long-standing relationship.

Active management and value creation

• TPG completed a large add-on acquisition to CAA by acquiring ICM Partners in September 2021 for a total consideration of US$750m. The combination of CAA and ICM has created a larger platform with access to a global clientele of artists in film, television, music and other entertainment segments. ICM was the fourth largest talent agency prior to the acquisition, and its industry-leading publishing division complemented CAA’s content-driven motion pictures, television, and podcasting businesses, while the combination created a greater number of opportunities for their clients.
• During TPG’s ownership, the company experienced significant organic growth driven by content proliferation and acquisition of further sports rights. In addition, demand from streaming services such as Netflix, Apple TV+ and Hulu has fuelled CAA’s growth.

Exit

TPG sold CAA to Groupe Artémis, the investment company of the Paris-based Pinault family, which has a portfolio of global luxury brands in arts, fashion, publishing, sports and technology.