Fantex Postpones Arian Foster Share Sale Because of Back Surgery
Fantex, Inc. postponed plans to offer public shares on Arian Foster with the Houston Texans running back set to undergo season-ending back surgery.
San Francisco-based Fantex last month filed with the U.S. Securities and Exchange Commission to raise $10.6 million in an initial public offering priced at $10 a share for Foster, who pledged 20 percent of his on- and off-field earnings to the company in exchange for most of the proceeds of the IPO. It was to be the first public offering for a professional athlete.
“After consideration, we have made the decision to postpone the offering for Fantex Arian Foster,” Fantex Chief Executive Buck French said yesterday in a statement. “We feel this is a prudent course of action under the current circumstances.”
Foster and San Francisco 49ers tight end Vernon Davis are the only National Football League players who have agreements with Fantex, which has said it plans similar partnerships with other professional athletes. Fantex on Oct. 31 agreed to buy 10 percent of Davis’s future earnings for $4 million in advance of selling shares to the public.
The Texans yesterday placed Foster, 27, on the season-ending injured reserve list.
The fifth-year running back from the University of Tennessee rushed for 542 yards and one touchdown in eight games for the Texans this season. He had rushed for at least 1,200 yards and 10 scores each of the previous three seasons, while making three straight Pro Bowl appearances.
“We continue to support Arian and his brand, and we wish him well in his recovery,” French said. “We will continue to work with him through his recovery and intend to continue with this offering at an appropriate time in the future based on an assessment of these events.”
Foster is in the second year of a five-year contract with the Texans and is eligible to receive a salary of as much as $23.5 million through the 2016 season.
Foster has endorsement contracts with companies such as Under Armour Inc. (UA) and Kroger Co. (KR) He also recently acquired an undisclosed stake in Health Warrior Inc., the closely held nutrition company known for its chia bars.
Fantex hasn’t said when it will offer public shares for Davis, who had been the NFL’s highest-paid tight end when he signed a five-year, $23 million contract with the 49ers in 2010.
Fantex Brokerage Services LLC is managing the NFL player offerings along with Stifel Financial Corp. No investor will be allowed to purchase or hold more than 1 percent of any series of common stock issued by the company, the filing shows. Orders for the stock will be posted and executed by Fantex’s brokerage’s alternative trading system, and the shares won’t be listed on the New York Stock Exchange (NYX) or the Nasdaq Stock Market.
To contact the editor responsible for this story: Michael Sillup at email@example.com