Trail has acquired a group of companies in the Mixed Martial Arts sector to create a single group, Ares MMA via its SLAM fund.
The acquired groups includes, Ares Fighting Championship, Management Factory, FBC Production and Fight Management which have all detected, trained and produced multiple combat sport athletes recognised in the sector.
This will encourage development for the new group in Europe, The Middle East and Africa due to SLAM’s expertise in geographic growth and operational performance. This will also benefit the crossing of sectors, sport, luxury, art and music to offer innovative experiences.
Trail was advised by CPC & Associés throughout this acquisition with Arnaud Péricard, Edouard Bouffannais and Jean-Baptiste Bertrand.
“We are very excited to have been retained and selected by Trail Private Equity to provide legal transactional services with the newly formed SLAM Fund, the 1st ever PE fund dedicated to sports in France”.
Q&A with Arnaud Péricard
Arnaud, can you expand on this acquisition and your role throughout the process of the acquisition for your client?
Through its SLAM private equity fund, created in December 2023, TRAIL invests in the sports, luxury goods, art and music sectors. As part of its development strategy, the fund has decided to acquire the AresMMA group.
Backed by our experience and expertise in sports law, we have advised the SLAM fund since its inception. In this capacity, we were involved throughout the acquisition process, from due diligence to the drafting of all contractual documentation as well as all strategic options and moves on the project.
Can you tell us how yourself and your colleagues’ skills were utilised during this acquisition, what individual value did you each bring and how did you work seamlessly throughout?
My team and I specialize in sports law, and sports law is unique in that it covers a number of different law matters, including corporate law, contract law, labour law, tax law, etc. Our team, in addition to its mastery of sports law, has a specialist in each of these matters, so it is complementary.
Each member of the team, with his or her specific skills, is able to study and analyse the documents sent by the target independently. This independence becomes a source of complementarity, as it enables us to raise all the legal issues applicable to the target and to address to our client all the points of vigilance required during due diligence. This complementarity also applies to the drafting of contractual documents for the acquisition.
In addition to these legal skills, such an acquisition requires patience and rigor. And our team's great availability, both to the client and to each other, enabled us to maintain the momentum needed to finalize the acquisition on schedule.
What is your typical process of due diligence and was this adapted for this particular project?
Depending on the timetable set by the client, we need to set up a due diligence process quickly. As soon as a target is identified by the client, it's up to us to identify its sector of activity, as well as its specific features. Once this work has been carried out, we draw up a document list, adapted to the target and our client's needs, of the documents and elements required for our review, so that we can then issue a report. Sports law in France is also very much driven by public and administrative law and we have strong expertise in these matters within our firm.
To ensure that our review is complete, and to enable us to write the most accurate report possible, a classic Q&A system is put in place.
For this acquisition, we chose to issue an initial red flag report targeting our points of particular attention, thus enabling the client to get a first idea of the target and any difficulties he might encounter. Then, in line with the defined timetable, and after further discussions with the target, we issued our final report.
This two-stage process enables the client to confirm, or deny, his interest. The red flag report adds further time for reflection.
This process proved particularly well-suited to the situation. In fact, certain issues not envisaged by the client were revealed, enabling him to adapt, and direct differently, his discussions with the target.
Can you give examples of advisory methods your team used for Trail to ensure they had the most accurate and beneficial method possible for this acquisition?
This acquisition followed a classic pattern, i.e. the setting up of a data room, enabling a due diligence report to be drawn up, followed by an investment protocol with signing and closing.
To ensure that Trail had all the information it needed to make its decision, regular general meetings (at least 2 per week, throughout the acquisition) were initiated by our firm.
Then each member individually, for the documentation he was specifically responsible for drafting, had to regularly draft and send a progress report (at least 1 per week) to the client, informing him in real time of the latest changes affecting him.
It was through the implementation of such a process that the team was able to keep to the schedule agreed between the client and the target.
This acquisition will allow Ares MMA to develop and flourish in new locations, how does the acquisition give them the strength to do this and what could be their next step?
Trail's SLAM fund is endowed with 200 million euros, and adopts a novel approach that combines TRAIL's investment experience with the know-how of international athletes, such as Formula 1 driver Pierre Gasly, and leading sports experts and entrepreneurs.
For this acquisition, SLAM has teamed up with fighter Ciryl Gane and aims to expand internationally, notably by creating a European combat sports championship.
Does your team at CPC & Associés have any plans in place to support Trail through their next stage as they develop their acquires assets and take Ares MMA to new heights?
The CPC & Associés team supports Trail in the development of Ares MMA. In particular, the team is assisting Trail with the legal structuring of Ares MMA from both a corporate and employment law perspective.
The team also advises on contractual and sports law, and reviews all fighter, sponsorship and event organization contracts (most recently ARES 22).
In addition to this short-term support, Trail and the CPC law firm are looking further ahead and starting to work on the structure's international development.
