Wanda Sports Group (WSG), the owner of the Iron Man Triathlon franchise and soccer marketing group Infront Sports, has filed for an initial public offering in the US with a goal of raising up to $500 million, according to an SEC filing by the company earlier this month.
The sport and live events unit of Wang Jianlin’s Dalian Wanda Group plans to list American Depositary Shares (ADS) on the NASDAQ exchange under the ticker WSG, according to the filing.
Wanda Sports, which was assembled through a series of acquisitions over the last five years by the commercial real estate group which once hoped to become a media-property-tech conglomerate, is organising the market listing with the goal of paying off a high interest loan associated with its spin-off from Dalian Wanda Group.
Sports Group Debt Nearly Outpaces Sales
While the public version of Wanda Sports’ SEC filing redacted the amount of the debt it planned to repay, the company made clear that it would use the IPO proceeds to pay off a loan which it had taken out to pay off a $350 million promissory note to Wanda Group as part of the restructuring that allowed the sports marketing division to win its independence from the rest of Wang Jianlin’s empire.
That loan, which carries an 11.5 percent interest rate, is part of Wanda Sports total indebtedness of just over €1 billion ($1.13 billion) as of 31 March 2019.
The company said that it would employ any unused balance for general purposes, and for strategic investments, although it conceded that it had not yet identified specific strategic investment opportunities.
Wanda Sports, which bills itself as one of the world’s largest sports events, media and marketing platforms, booked $1.3 billion in sales for the 12 months ending March 31, 2019, according to its filing.
Wanda Wants to Flog the Ironman
European football marketing firm Infront, which Wanda acquired from the private equity group Bridgepoint in 2015 for $1.2 billion, is among Wanda’s highest profile sports assets. Run by Philippe Blatter, a nephew of former FIFA head Sepp Blatter, is the exclusive sales representative for distribution of broadcast rights to the 2018 and 2022 World Cups. It also does media and marketing for the Chinese Basketball Association.
WSG also owns World Endurance Holdings, the Florida-based organizer of the Ironman Triathlon races, which Wanda bought for $650 million just six months after its purchase of Infront,
According to financial statements accompanying the SEC filing, as of March 31, 2019, WSG had total assets of $2.27 billion, including $209.67 million in cash in hand.
For 2018, WSG reported revenues of €1.13 billion and basic profit attributable to ordinary equity holders of the parent firm of €51.6 million down from €77.2 million in 2017.
For the three months ended March 31, 2019, Wanda Sports recorded revenue of €246 million and a loss attributable to ordinary equity holders of €8.6 million.