basically, it's all about sports.

happy to help,
-mike

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https://lshtm.academia.edu/MikeCallaghan

http://howtobeswiss.blogspot.ch/

love to have your take on this, publicly here or privately to me, via PM or email, pursuant to an article i might write on this.

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Dan Empfield
aka Slowman

Might get better results over on that other forum, windywave or greenplease, or several others that are well versed in this stuff.

I figured they were not going to get a buyer, at least not at a price that didn't have them losing a ton of money. This is their last and best hope I guess, hope that the market makers and buyers see more value than their actually is. Happens all the time, but usually with tech and internet stocks, not sure about brick and mortar like WTC and other sports are... Could be an emotional extra value I suppose, who doesn't want to own a share of Ironman!

It's pretty neat that they pay Marvel a licensing fee for the use of the "IRONMAN" brand.

I just skimmed the document, but they do no appear to break out the performance of Ironman as an operating segment. It's rolled up to "Mass Participation" segment which includes a whole bunch of other stuff, such as Rock N Roll Marathon, etc.

The max offering size on the cover right now is $500M, but they could offer more or less than that amount. The deal hasn't yet priced. This generally isn't something that's known until after a process to assess the interest of institutional buyers and get feedback on appetite, price, etc. Shortly before the IPO happens, the deal would get priced and the bankers capital markets desk will take orders from buyers and allocate the "book" among the buyers. If demand is soft, the IPO could get pulled at any time.

these businesses are not exactly compatible. they're not incompatible. infront is roughly analogous to, say, IMG. of course IMG also has a mass participation business. infront is a small IMG, whereas IMG is a small ironman. still, infront was/is bigger than ironman. but ironman has grown faster than infront over the past couple of years, largely thru acquisition (most notably rock 'n' roll). that acquisition seemed to me a rather cheap pick-up.


i guess the biggest question i currently have is how much of this new company wanda is floating. is it keeping 10 percent? 60 percent? i think i want wanda to keep quite a bit, because i want wanda's continued help in opening up new locations in china.

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Dan Empfield
aka Slowman

Wasn't there a an idea a few years back (by a coach who shall remain unnamed) to buy Ironman from Wanda (or their previous owner). Well, here is a chance to do just that.

Hey Dan,
The way this normally works is more data become released as time goes.

After each submission, the SEC is going to have comments and questions that Wanda/Ironman will have to address.
Finally, in the weeks immediately before the actually offering (and the roadshow), they will file a final F-1a that includes the amount of shares they will sell and the expected pricing range.

This one just tells the overall financial state, and the business story... the actual details of the offering will come later .

What I wouldn't expect is more breakdown (at lest yet).
Later, possibly during earnings calls, etc... they could break things down further, but I wouldn't expect it in a subsequent filing

thanks. i'm reasonably naive to this process. i've acquired companies numerous times, and i've sold my own company to a public company, but nothing even close to this scale. i'm a simple guy ;-(

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Dan Empfield
aka Slowman

P. 166 shows the blank table that eventually will illustrate pro forma ownership.

One takeaway is that a dual class shareholder structure is indicated. They are selling class A shares. Class B shares, which they will retain, have 4:1 voting rights over class A, although they have equivalent economic interest. In other words, they are looking to exercise control beyond their economic interest.

Also amusing to see how they characterize triathlon as a growth sport. It all depends on the time period over which you make the calculation.

I also was struck by how much money comes from host fees. Gives you a good perspective on how races come and go.

Amusingly, Peloton also was reported to have confidentially filed for an IPO. Valuation talk there presumably will dwarf what this WTC parent will get. It makes me think: is there any logic to a company like Peloton acquiring a decidedly non-tech, but fitness oriented, business like this? Why would they do it? Extensive contact lists, merchandising synergy, cross selling, etc.

Why would they do it? //

Because it would be a good deal, as in they did their homework and felt the valuation was lower than what they are paying.. Other than that, they would have to think they could grow the business beyond what any premium they might have paid for it...

Good to see that I once again belong in a "demographically attractive" segment of the population

Quote:

Mass participation sports athletes are demographically attractive as they are generally more affluent and able to afford spending on goods and services related to mass participation sports when compared with the general population.

Sorry perhaps I am mistaken but isn't it a growth sport on a global scale? I know details of participation in other countries aren't detailed annually like USAT does but it seems like participation continues to grow at last with WTC outside of the US.

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808 > NYC > PDX > YVR
2024 Races: Taupo

Interestingly, Infront is run by Sepp Blatter's nephew, yeah, that Sepp Blatter. Infront is trying to become the media rights agency for World Rugby's World League and was Guarantying World Rugby 10 Billion over 10 years...some preposterous numbers.

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Washed up footy player turned Triathlete.

My questions are where will they list, and clarity/accuracy of reporting post IPO. Ie per Greenplease You need to proceed with caution regarding financial statements from Chinese companies.

Haven’t read the filing and likely wouldn’t be able to offer input, agree that you would get more traction in the LR.

Maurice

Listing on NASDAQ, per the release I'd seen.

Can't say I'm surprised in the A/B distinction in voting rights. I still think its slightly insane, given the current state of Bible-thumping around "shareholder value," to put a company built on athlete services and safety through that. You know somebody's going to start screaming about rate of return after the honeymoon period is over.

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Editor-in-Chief, Slowtwitch.com | Twitter

Just a short glance, but my guess would be they'll be looking for >$1bn valuation at the lower end of the price range. $60m average net income over the last 3y excluding the BS goodwill writedown would give approx. 16.5x PE, which would be in-line with S&P500 forward PE (couldn't see any meaningful forward looking statements in the filing, but didn't look very hard either), so I'd think they'll be looking to retain ~60% at the mid-range ($1.25bn valuation). Maybe I am discounting the $366m shareholder equity a bit too much, but they're highly leveraged.

Not sure people will jump at this one without breakdown into the different operating segments. Without further detail, the football stuff looks to me more like a liability with bad debt write-downs and fraudulent football related activities.

How much of Infronts business is part of the IPO though? The Infront intl Holdings ag is not part of the offering, but the corporate structure doesn't show what else is held by that entity.They paid $1bn for Infront and $650m + debt for WTC, so anything well under $1.6bn would be a significant loss for Wanda (debt will be passed on to the new entity), if all of Infronts biz is part of the IPO.

It will be interesting if NASDAQ allow them to list.

I would be surprised if they shop the listing around to European exchanges with aa backup of maybe Singapore.

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" It plans to list on the Nasdaq under the symbol WSG. Wanda Sports Group filed confidentially on March 20, 2019. Morgan Stanley, Deutsche Bank and Citi are the joint bookrunners on the deal. No pricing terms were disclosed. "
https://www.nasdaq.com/...ion-us-ipo-cm1160931

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Editor-in-Chief, Slowtwitch.com | Twitter

The risk factors are interesting reading.

Except there’s no reason to think that goodwill right down was BS. They have $900mm of goodwill on their balance sheet (for people unfamiliar with the term this is an amount they paid for brands, trademarks, etc that is not an actual physical thing). I’d wager the true value of that goodwill is substantially less than that. They have a ton of debt relative to enterprise value (>5x levered even using their ‘adjusted’ EBITDA). This is not a quality company in terms of growth prospects, balance sheet, industry, or management acumen and should trade with a substantial discount to the S&P average multiple. I would not buy this stock unless it was absurdly cheap.

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Dimond Bikes Superfan

a

I think we agree on that - most goodwill balance sheet items are money down the drain, it's got no relevance for future earnings. What the company does with the brand going forward matters, not how much they inflate the balance sheet with it. Poor wording from my side. If they really have $900m goodwill left, then they would be in negative shareholder equity, not exactly a sign of health.

Growth I think I read somewhere 6% CAGR, agree not exactly stellar (but revenue growth 2016-2018 looked substantially higher, but perhaps at the expense of higher debt for acquisitions). Not sure what the right multiple would be, but there seems to be little detailed disclosure, so I would agree that one should be cautious.

Finance/banker type here. The A/B structure will not be well received and will bring a discount. Have to go through doc later but would be surprised if Wanda was listing >50%.


You do not think Wanda cared about a return on their investment? What is an appropriate ownership structure? State owned? Maybe the Red Cross could take it over and run Ironman as a charity? You do not think shareholders want their investment manged well?