XPost: rec.sport.pro-wrestling

April 3, 202310:59 AM ET
By The Associated Press

WWE and the company that runs Ultimate Fighting Championship will
combine to create a $21.4 billion sports entertainment company.

A new publicly traded company will house the UFC and World Wrestling Entertainment brands, with Endeavor Group Holdings Inc. taking a 51% controlling interest in the new company. Existing WWE shareholders will
hold a 49% stake.

The companies put the enterprise value of UFC at $12.1 billion and WWE's
value at $9.3 billion.

The new business, which does not yet have a name, will be lead by
Endeavor CEO Ari Emanuel. Vince McMahon, executive chairman at WWE, will
serve in the same role at the new company. Dana White will continue as president of UFC and Nick Khan will be president at WWE.

"Together, we will be a $21+ billion live sports and entertainment
powerhouse with a collective fanbase of more than a billion people and
an exciting growth opportunity," McMahon said in a prepared statement
Monday.

He also provided some idea of where the focus of the new company will
be, saying that it will look to maximize the value of combined media
rights, enhance sponsorship monetization, develop new forms of content
and pursue other strategic mergers and acquisitions to further bolster
their brands.

Ties already exists talent wise between WWE and UFC, with stars such as
Brock Lesnar and Ronda Rousey crossing over between the two businesses.

The deal between Endeavor and WWE catapults WWE into a new era, after functioning as a family-run business for decades. McMahon purchased
Capitol Wrestling from his father in 1982, and took the regional
wrestling business to a national audience with the likes of wrestling
stars such as Andre the Giant, Hulk Hogan and Dwayne "The Rock" Johnson.
The company, which changed its name to World Wrestling Federation and
later World Wrestling Entertainment, hosted its first WrestleMania in
1985.

McMahon, in an interview with CNBC, addressed the notion that there was
doubt among some WWE fans and industry experts that he would ever make a
deal for the business. "It's the right time to do the right thing. And
it's the next evolution of WWE," he said.

The announcement of the WWE sale arrives after McMahon, the founder and majority shareholder of WWE, returned to the company in January and said
that it could be up for sale.

Rumors swirled about who would possibly be interested in buying WWE,
with Endeavor, Disney, Fox, Comcast, Amazon and Saudi Arabia's Public Investment Fund all in the mix.

McMahon acknowledged to CNBC that there were several suitors for WWE,
but that combining with Endeavor is the right move.

"It makes all the sense in the world for all these synergies that we
have to extract all of the value that we can out of the marketplace," he explained.

Media industry analysts viewed WWE as an attractive target given its
global reach and loyal fanbase, which includes everyone from minors to
seniors and a wide range of incomes.

The company held its marquee event, WrestleMania, over the weekend. Last
year, WWE booked revenue of $1.3 billion.

The company is also a social media powerhouse. It surpassed 16 billion
social video views in the final quarter of last year. It has nearly 94
million YouTube subscribers and has more than 20 million followers on
TikTok. Its female wrestlers comprise five out of the top 15 most
followed female athletes in the world, across Facebook, Twitter &
Instagram, led by Ronda Rousey with 36.1 million followers.

WWE had more than 7.5 billion digital and social media views in January
and February of this year, up 15% from the same time frame a year ago.

The new company plans to trade on the New York Stock Exchange under the
"TKO" ticker symbol. Its board will have 11 members, with six being
appointed by Endeavor and five being appointed by WWE.

"We like the assets of UFC and also WWE in a world where linear TV is
losing market share to streaming, thus live sport content is in high
demand," wrote Jeffries analyst Randal Konik said in a note to clients.

The transaction, which was approved by the boards of Endeavor and WWE,
is targeted to close in the second half of the year. It still needs
regulatory approval.

Shares of World Wrestling Entertainment Inc., based in Stamford,
Connecticut, are up 33% this year, but fell 5% at the opening bell
Monday. Shares of Endeavor, based in Beverly Hills, California, slipped
less than 1%.

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