WPP believes that a price tag of up to $2.5 billion for IMG Worldwide is too high to justify a bid for the sports marketing group, CEO Martin Sorrell said on Thursday. “We would love to own IMG,” Sorrell told the Leaders in Football sports industry conference. Asked if WPP was bidding, he added: “No, we can’t afford it.”
IMG, set up by American sports agent Mark McCormack in 1960, is up for sale after the death in 2011 of owner Teddy Forstmann, who paid $750 million for the business in 2004.
Sorrell said he believes that private equity company Silver Lake and its partner William Morris Endeavor Entertainment are the most likely purchasers but noted strong competition. “People are talking about 2 to 2.5 (billion dollars). They are talking about 20 bidders, 10 bidders going into the second round. That’s nose-bleed territory for us,” Sorrell said.
Sorrell estimates that IMG generates annual revenues of about $1.25 billion and core profit of between $170 million and $200 million.
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