Sports agency lists in London, maps growth
NEW YORK (MarketWatch) — The agency that recently secured New York Yankees pitcher C.C. Sabathia a new nine-figure contract is now part of a listed company. Its stock is traded in London.
A merger between two sports agencies has seen the creation of a new outfit that will focus on baseball player contracts and the marketing of current and former stars from across the sports world.
The new firm, called The Legacy Agency, will operate under parent TLA Worldwide, which is listed in London. The agency is the result of a merger between Legacy Sports Group and The Agency Sports Management.
Bringing the two together isn’t unique. Octagon, a unit of Interpublic Group, handles player contracts and also sponsorship and marketing opportunities, for example. But the move does highlight the increasingly big business that is sports sponsorship and marketing.
Sports sponsorship in North America is expected to reach $12.95 billion in 2012, a figure that was $11.66 billion in 2010, according to the IEG Sponsorship Report. Sports will account for 69% of all sponsorship spending this year.
“Sports and entertainment is a great industry that is growing,” said Michael Principe, chief executive of TLA Worldwide. “We believe we’ve identified an opportunity in the market and by merging we will be able to better service our existing clients and drive new revenue to our clients and our company.”
The representation side of the business will focus on baseball, said Principe. It already acts for stars including ace pitcher Sabathia, who in October re-signed with the Yankees for five years and $122 million; Boston Red Sox outfielder Carl Crawford; and Rickie Weeks, the Milwaukee Brewers second baseman.
Off the field, the agency markets a range of sports stars, including Miami Dolphins running back Reggie Bush, track-and-field star Lolo Jones and golfer Jim Furyk. Related SportsWatch: Where are today’s stars of track and field?
Principe said the focus for now will be in “growing and consolidating” the baseball representation practice. Other sports may follow, but not yet, he said.
“We chose baseball as our initial on-field focus because of its strong fundamentals: long, contracted, visible earnings in a sport that is global, growing and enjoys unprecedented levels of success and labor stability,” he added.
The firm listed on the London Stock Exchange’s AIM market in December. The market is often a spot for small international companies at the early stages of their growth who are looking for capital.
As of Wednesday’s close TLA Worldwide’s market capitalization was £14 million ($22 million). It did not reveal annual revenues and income.
“We chose AIM because it has a great track record for growth companies and has the credibility and respect of the investment community,” said Principe, who said that, while the company plans to grow organically, targeted acquisitions are also part of its plan.