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WrestleMania will take place on April 1, 2023 at the SoFi Arena in Inglewood, CA with the Hollywood extravaganza.Photo by Ronald Martinez/Getty Images
WWE and the company that runs the Ultimate Fighting Championship will merge to create a $21.4 billion sports entertainment company.
A new public company will own the UFC and World Wrestling Entertainment brands, with Endeavor Group Holdings Inc. holding a 51 percent controlling interest in the new company. Existing WWE shareholders will own 49 percent.
The two companies pegged the enterprise value of UFC at $12.1 billion and WWE at $9.3 billion.
The new business, which has yet to be named, will be led by Endeavor CEO Ari Emanuel. WWE Executive Chairman Vince McMahon (Vince McMahon), will play the same role in the new company. Dana White will continue as UFC President and Nick Khan will serve as WWE President.
“Together we will be a live sports and entertainment powerhouse worth more than $2.1 billion, with a fan base of more than one billion and exciting growth opportunities,” McMahon said in a prepared statement on Monday.
He also offered some thoughts on the new company’s focus, saying it would seek to maximize the value of combined media rights, enhance sponsorship monetization, develop new forms of content and make other strategic acquisitions to further strengthen them. brand.
There is already a talent connection between WWE and UFC, with stars like Brock Lesnar and Ronda Rousey crossing between the two companies.
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The deal between Endeavor and WWE ushers in a new era for WWE, which had operated as a family business for decades. McMahon acquired Capitol Wrestling from his father in 1982 and brought the regional wrestling business to a national audience that included wrestling stars like Andre the Giant, Hulk Hogan and Dwayne Johnson. The company changed its name to the World Wrestling Federation, and later to World Wrestling Entertainment, and held the first WrestleMania in 1985.
Speaking to CNBC, McMahon addressed the notion that some WWE fans and industry pundits doubt he’ll close a deal for the business. “This is the right time to do the right thing. This is the next evolution of WWE,” he said.
WWE’s sale announcement comes after McMahon, WWE’s founder and majority owner, returned to the company in January and said a sale was possible.
Rumors swirled about who might be interested in acquiring WWE, with Endeavor, Disney, Fox, Comcast, Amazon and Saudi Arabia’s Public Investment Fund all involved.
McMahon admitted to CNBC that WWE has several suitors, but merging with Endeavor was the right move.
“For all these synergies, we have to extract all the value we can from the market that makes sense in the world,” he explained.
Media industry analysts see WWE as an attractive target because of its global reach and loyal fan base, which includes everyone from minors to senior citizens, as well as a wide range of income.
The company held its big event, WrestleMania, over the weekend. Last year, WWE had $1.3 billion in revenue.
The company is also a social media giant. It surpassed 16 billion social video views in the last quarter of last year. It has nearly 94 million subscribers on YouTube and more than 20 million followers on TikTok. Five of the top 15 most followed female athletes in the world on Facebook, Twitter and Instagram are female wrestlers, led by Ronda Rousey with 36.1 million followers.
In January and February of this year, WWE saw more than 7.5 billion digital and social media views, a 15 percent increase over the same period last year.
The new company plans to trade on the New York Stock Exchange under the ticker symbol “TKO.” Its board of directors will have 11 members, six appointed by Endeavor and five appointed by WWE.
“We like the UFC and WWE properties in a world where linear TV is losing market share to streaming, so live sports content is in high demand,” Jeffries analyst Randal Konik wrote in a note to clients. “
The deal has been approved by Endeavor and WWE’s board of directors and is scheduled to close in the second half of this year. It still needs regulatory approval.
Shares of Stamford, Connecticut-based World Wrestling Entertainment Inc. have risen 33% this year, but were down 5% at the open on Monday. Shares of Beverly Hills, Calif.-based Endeavor fell less than 1 percent.
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