Layoffs Hit IMG in Wake of WME Purchase
The sports and entertainment company will eliminate 3 percent of jobs in the next couple weeks
IMG, the sports and entertainment behemoth acquired earlier this year by WME, will downsize its workforce by about 3 percent in the next few weeks.
That percentage translates to around 100 employees of IMG, which focuses on sports and fashion and serves as both a talent agency and events management company. The cuts will be global and will not be concentrated in any division, but will be spread evenly throughout the company, according to IMG.
The cuts were an expected result of the WME acquisition, which was announced late last year but did not become official until May. The layoffs are designed to eliminate redundancies.
WME, the Beverly Hills-based agency run by co-CEOs Ari Emanuel and Patrick Whitesell, and its stakeholder Silver Lake Partners, won an auction last December for IMG with a bid of $2.35 billion. The deal came with 3,500 IMG employees and brought about some new hires, including former Dick Clark Productions CEO Mark Shapiro as IMG's CCO and former Microsoft executive Chris Liddell as WME/IMG CFO to replace Peter Klein, who left the agency six months after the merger.
The agencies faced some hurdles in their first months of combined operations, with Klein's departure and a couple of college sports clients terminating their relationships with IMG. But then WME/IMG scored a number of major representation pacts, including a 10-year deal that makes IMG the worldwide distributor and international syndication partner for NASCAR and a global media rights deal with Major League Soccer and U.S. Soccer through 2022. IMG's client list currently boasts Maria Sharapova, Colin Kaepernick, Gisele Bundchen, Kate Moss and, in a recent signing, Wayne Gretzky.
The agency has undergone some restructuring following a review of its operations by WME. Its Events & Federations and Media businesses and events for fashion, golf and tennis were brought together into a new Events & Media division, and the agency's European offices have seen a series of changes, including the transition of the IMG's Swiss operation IMG Schweiz to a Munich office and the consolidation of offices in Germany and France.
Emanuel and Whitesell announced the downsizing in a memo to the company on Monday. Read the full text below:
In the seven months since WME acquired IMG, we’ve been focused on helping this company live up to its potential as the global leader in sports, media and fashion. We’ve worked alongside all of you to consolidate businesses, create new roles, and collaborate across departments in ways that will fundamentally change not just WME | IMG but ultimately our industry. We’ve seen firsthand how hard you’ve all been working to bring these two companies together, and we’re grateful.
As you’ve heard us say, we are incredibly well-positioned for the future. We’ve had a strong start financially, the business is performing well around the world, and our ability to connect, develop, and promote artists, athletes, media and brands is unmatched at a time when our industry has never been stronger.
But to take full advantage of the opportunity that lies ahead, we have to make some tough choices about how we allocate our resources at IMG. In the coming month, we’ll be updating you on some changes in the business that will help ensure we’re all set up to succeed.
As a first step in this process, we will be downsizing three percent of our workforce across IMG in the coming weeks.
These decisions aren’t easy, but they are necessary for us to best position IMG for future growth and success. These changes will allow us to more effectively invest in our future through acquisitions; to re-allocate our resources to high-growth businesses; and ensure we realize our full potential across WME | IMG.
Thank you all in advance for your help through this transition. Changes like these are always difficult, and we appreciate your hard work and dedication.
Dec.1, 1:04 p.m. Updated with Emanuel and Whitesell's memo.