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On Tuesday, entertainment and media agency William Morris Endeavor won a bidding war for IMG, the huge sports and media talent agency that we know primarily for IMG Models. The bid seems to have been motivated by the declining profitability of television and film.

A combined IMG and William Morris Endeavor would significantly alter the balance of power in Hollywood’s business landscape, creating a mega-agency that would leap ahead of its primary rival, Creative Artists Agency. At the same time, the acquisition, with its accompanying thrust into sports events and interests like media and fashion, moves William Morris Endeavor’s center of gravity away from the increasingly troubled businesses of movies and television, where growth potential is limited.

The losing bidders were the former News Corporation executive Peter Chernin, who was working with CVC Capital, and the talent agency ICM, working with the Carlyle Group. Both of those groups are believed to have offered less than $2 billion.

IMG is vastly bigger, with 3,500 employees and offices in more than 30 countries. It has the leading college sports marketing business in the United States, handling lucrative organizations including the National Collegiate Athletic Association, as well as individual universities and athletic conferences and major events like the Rose Bowl. Leading professional sports clients include the quarterbacks Peyton and Eli Manning. IMG is also a leader in golf and tennis.

Its musical clients include pop stars such as Justin Timberlake and Taylor Swift. IMG also operates a large fashion show and modeling division. But most of its money comes from licensing and media rights deals.

Robert M. Gutkowski, a partner at Innovative Sports and Entertainment, which advises private equity firms, believes the impending merger will be a boon to models crossing over into the realms of film and television. He told Fashionista.com:

IMG is going to have a very strong opportunity to take advantage of their talent that wants to move into film and television, while remaining in house.” For example, when a model does a film, the revenue generated will remain within the company — instead of going elsewhere. “And a tremendous amount of models move into entertainment and movies.

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