Other Sports Endeavor to buy controlling interest in WWE, merge it with UFC to create new company

Sassy Squatch · 04-03-2023, 06:23 AM

https://investor.endeavorco.com/news...y/default.aspx

New, Publicly Listed Company to be 51% Owned by Endeavor and 49% by Existing WWE Shareholders

Endeavor to Contribute UFC into Company at Enterprise Value of $12.1 Billion

BEVERLY HILLS, Calif. & STAMFORD, Conn.--(BUSINESS WIRE)-- Endeavor Group Holdings, Inc. (NYSE: EDR) (“Endeavor”) and World Wrestling Entertainment, Inc. (NYSE: WWE) (“WWE”) today announced that they have signed a definitive agreement to form a new, publicly listed company consisting of two iconic, complementary, global sports and entertainment brands: UFC and WWE. Upon close, Endeavor will hold a 51% controlling interest in the new company and existing WWE shareholders will hold a 49% interest in the new company.

Together, UFC and WWE will have global reach, impressive scale and omnichannel distribution. On a combined 2022 fiscal year-end basis, UFC and WWE achieved revenue of $2.4 billion and a 10% annual revenue growth rate since 2019.

“This is a rare opportunity to create a global live sports and entertainment pureplay built for where the industry is headed,” said Ariel Emanuel, CEO of Endeavor. “For decades, Vince and his team have demonstrated an incredible track record of innovation and shareholder value creation, and we are confident that Endeavor can deliver significant additional value for shareholders by bringing UFC and WWE together.”

“Given the incredible work that Ari and Endeavor have done to grow the UFC brand – nearly doubling its revenue over the past seven years – and the immense success we’ve already had in partnering with their team on a number of ventures, I believe that this is without a doubt the best outcome for our shareholders and other stakeholders,” said Vincent K. McMahon, Executive Chairman of WWE.

McMahon continued, “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. The new company will be well positioned to maximize the value of our combined media rights, enhance sponsorship monetization, develop new forms of content and pursue other strategic mergers and acquisitions to further bolster our strong stable of brands. I, along with the current WWE management team, look forward to working closely with Ari and the Endeavor and UFC teams to take the businesses to the next level.”

The new company will be led by Emanuel (Chief Executive Officer), who will also continue in his role as Chief Executive Officer of Endeavor, McMahon (Executive Chairman of the Board) and Mark Shapiro, who will be President and Chief Operating Officer of both Endeavor and the new company. Dana White will continue in his role as President of UFC and Nick Khan will serve as President of WWE. The Board of Directors will consist of 11 members who will be appointed at a later date, six of whom will be appointed by Endeavor and five of whom by WWE.

Together, UFC and WWE expect to deliver an estimated $50 million to $100 million in annualized run rate cost synergies by leveraging, among other things, Endeavor’s back office and robust infrastructure. Endeavor also expects significant growth across revenue areas including domestic and international media rights, ticket sales and yield optimization, event operations, sponsorship, licensing and premium hospitality. Endeavor’s success at UFC, including increasing commercial opportunities that have driven more than 2x Adjusted EBITDA growth since its acquisition in late 2016, demonstrates the significant value creation opportunity and upside potential of having UFC and WWE under one roof.

Transaction Details and Approvals

The transaction values UFC at an enterprise value of $12.1 billion and WWE at an enterprise value of $9.3 billion. The transaction represents a contribution price of WWE of approximately $106 per share (before any post-closing dividend). Additionally, UFC and WWE will each contribute cash to the new company so that it holds approximately $150 million. At closing, Endeavor intends to sweep all excess cash at UFC, and shareholders of the new company (other than Endeavor) are expected to receive a post-closing dividend.

Under the terms of the transaction, existing WWE shareholders will roll all existing equity into the new entity that will be the parent company of UFC and WWE (“NewCo” until it is named at a later date) and intends to list on the New York Stock Exchange under the ticker symbol “TKO”. The listing of NewCo will expand the collective investor base to allow for broad market participation across Endeavor and NewCo.

The transaction has been unanimously approved by the Executive Committee of the Board of Directors of Endeavor and by the Board of Directors of WWE. The transaction is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals. The transaction is expected to close in the second half of 2023.

This marks the successful conclusion of WWE’s strategic alternatives review process. WWE embarked on this process to take advantage of the company’s unique position in the entertainment ecosystem as well as the inflection point coming with its media rights renewals, both of which were widely recognized in the marketplace through this process.

POND_OF_RED · 04-03-2023, 06:29 AM

I bet they can get McGregor back now if there isn’t any actual fighting involved anymore. That guy was always pretty good at running his mouth, but terrible at fighting. He’ll fit right in with Vince and the gang.

Sofa King · 04-03-2023, 06:42 AM

Wonder if this means that athletes can bounce back and forth between the two. That could be interesting.

Jon Jones is out there fighting in UFC and then Brock Lesnar comes in with a chair and smashes Jones with it to set up the next title fight.

Wisconsin_Chief · 04-03-2023, 01:21 PM

This could really be interesting. They have a chance to turn this into a massive ratings and cash cow if they play it right.

Mecca · 04-03-2023, 01:27 PM

They're going to run them as 2 separate companies, McMahon is basically still in charge of running WWE.

You could see UFC guys bounce over but I doubt it'd ever go the other way.

ModSocks · 04-03-2023, 01:29 PM

You guys remember when WWE tried introducing real boxing and only their C list wrestlers would sign up, and then they all looked like complete pussies who couldn't take a punch?

Good times.

Sofa King · 04-03-2023, 02:42 PM

Quote:

Originally Posted by Detoxing

You guys remember when WWE tried introducing real boxing and only their C list wrestlers would sign up, and then they all looked like complete pussies who couldn't take a punch?

Good times.

I remember that. Some truly awful fights.

Vladimir_Kyrilytch · 04-03-2023, 02:48 PM

As long as Joe Rogan is still the announcer I will be a viewer, mergers be damned!

bdj23 · 04-03-2023, 02:51 PM

Didn't they try to turn Undertaker into an MMA fighter for a while?

Gary Cooper · 04-03-2023, 02:53 PM

Quote:

Originally Posted by Detoxing

You guys remember when WWE tried introducing real boxing and only their C list wrestlers would sign up, and then they all looked like complete pussies who couldn't take a punch?

Good times.

They had some legit tough guy. Dan Severn withdrew from the tournament for some reason. Shamrock did not participate. Steve Blackman was legit tough but got injured and pulled out. Kurt Angle wasn't yet in the WWE.

Gary Cooper · 04-03-2023, 02:54 PM

Quote:

Originally Posted by BDj23

Didn't they try to turn Undertaker into an MMA fighter for a while?

No. He studied MMA in his personal life and incorporated the triangle choke in his repertoire. There was nothing more to it though. He was never billed as an MMA fighter.

bdj23 · 04-03-2023, 02:57 PM

Quote:

Originally Posted by Gary Cooper

No. He studied MMA in his personal life and incorporated the triangle choke in his repertoire. There was nothing more to it though. He was never billed as an MMA fighter.

Gotcha I haven't watched wrasslin since the Attitude era.. I've tried to get back into it a few times but it's just so god damn bad now.

04-03-2023, 06:23 AM
Sassy Squatch The man you could post like. Join Date: Oct 2010 Casino cash: $2429655	Endeavor to buy controlling interest in WWE, merge it with UFC to create new company https://investor.endeavorco.com/news...y/default.aspx New, Publicly Listed Company to be 51% Owned by Endeavor and 49% by Existing WWE Shareholders Endeavor to Contribute UFC into Company at Enterprise Value of $12.1 Billion BEVERLY HILLS, Calif. & STAMFORD, Conn.--(BUSINESS WIRE)-- Endeavor Group Holdings, Inc. (NYSE: EDR) (“Endeavor”) and World Wrestling Entertainment, Inc. (NYSE: WWE) (“WWE”) today announced that they have signed a definitive agreement to form a new, publicly listed company consisting of two iconic, complementary, global sports and entertainment brands: UFC and WWE. Upon close, Endeavor will hold a 51% controlling interest in the new company and existing WWE shareholders will hold a 49% interest in the new company. Together, UFC and WWE will have global reach, impressive scale and omnichannel distribution. On a combined 2022 fiscal year-end basis, UFC and WWE achieved revenue of $2.4 billion and a 10% annual revenue growth rate since 2019. “This is a rare opportunity to create a global live sports and entertainment pureplay built for where the industry is headed,” said Ariel Emanuel, CEO of Endeavor. “For decades, Vince and his team have demonstrated an incredible track record of innovation and shareholder value creation, and we are confident that Endeavor can deliver significant additional value for shareholders by bringing UFC and WWE together.” “Given the incredible work that Ari and Endeavor have done to grow the UFC brand – nearly doubling its revenue over the past seven years – and the immense success we’ve already had in partnering with their team on a number of ventures, I believe that this is without a doubt the best outcome for our shareholders and other stakeholders,” said Vincent K. McMahon, Executive Chairman of WWE. McMahon continued, “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. The new company will be well positioned to maximize the value of our combined media rights, enhance sponsorship monetization, develop new forms of content and pursue other strategic mergers and acquisitions to further bolster our strong stable of brands. I, along with the current WWE management team, look forward to working closely with Ari and the Endeavor and UFC teams to take the businesses to the next level.” The new company will be led by Emanuel (Chief Executive Officer), who will also continue in his role as Chief Executive Officer of Endeavor, McMahon (Executive Chairman of the Board) and Mark Shapiro, who will be President and Chief Operating Officer of both Endeavor and the new company. Dana White will continue in his role as President of UFC and Nick Khan will serve as President of WWE. The Board of Directors will consist of 11 members who will be appointed at a later date, six of whom will be appointed by Endeavor and five of whom by WWE. Together, UFC and WWE expect to deliver an estimated $50 million to $100 million in annualized run rate cost synergies by leveraging, among other things, Endeavor’s back office and robust infrastructure. Endeavor also expects significant growth across revenue areas including domestic and international media rights, ticket sales and yield optimization, event operations, sponsorship, licensing and premium hospitality. Endeavor’s success at UFC, including increasing commercial opportunities that have driven more than 2x Adjusted EBITDA growth since its acquisition in late 2016, demonstrates the significant value creation opportunity and upside potential of having UFC and WWE under one roof. Transaction Details and Approvals The transaction values UFC at an enterprise value of $12.1 billion and WWE at an enterprise value of $9.3 billion. The transaction represents a contribution price of WWE of approximately $106 per share (before any post-closing dividend). Additionally, UFC and WWE will each contribute cash to the new company so that it holds approximately $150 million. At closing, Endeavor intends to sweep all excess cash at UFC, and shareholders of the new company (other than Endeavor) are expected to receive a post-closing dividend. Under the terms of the transaction, existing WWE shareholders will roll all existing equity into the new entity that will be the parent company of UFC and WWE (“NewCo” until it is named at a later date) and intends to list on the New York Stock Exchange under the ticker symbol “TKO”. The listing of NewCo will expand the collective investor base to allow for broad market participation across Endeavor and NewCo. The transaction has been unanimously approved by the Executive Committee of the Board of Directors of Endeavor and by the Board of Directors of WWE. The transaction is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals. The transaction is expected to close in the second half of 2023. This marks the successful conclusion of WWE’s strategic alternatives review process. WWE embarked on this process to take advantage of the company’s unique position in the entertainment ecosystem as well as the inflection point coming with its media rights renewals, both of which were widely recognized in the marketplace through this process.
Posts: 37,954

04-03-2023, 06:29 AM	#2
POND_OF_RED The talking stonehead Join Date: Feb 2006 Location: Blue Springs, MO Casino cash: $1753146	I bet they can get McGregor back now if there isn’t any actual fighting involved anymore. That guy was always pretty good at running his mouth, but terrible at fighting. He’ll fit right in with Vince and the gang.
Posts: 5,693

04-03-2023, 06:42 AM	#3
Sofa King Hello Join Date: Nov 2008 Location: South Dakota Casino cash: $1042096 VARSITY	Wonder if this means that athletes can bounce back and forth between the two. That could be interesting. Jon Jones is out there fighting in UFC and then Brock Lesnar comes in with a chair and smashes Jones with it to set up the next title fight.
Posts: 23,224	1 0

04-03-2023, 01:21 PM	#4
Wisconsin_Chief MVP Join Date: Aug 2019 Casino cash: $1980400	This could really be interesting. They have a chance to turn this into a massive ratings and cash cow if they play it right.
Posts: 7,179

04-03-2023, 01:27 PM	#5
Mecca Hockey Town Join Date: Apr 2005 Location: Kansas City, Missouri Casino cash: $2587050	They're going to run them as 2 separate companies, McMahon is basically still in charge of running WWE. You could see UFC guys bounce over but I doubt it'd ever go the other way.
Posts: 110,969

04-03-2023, 01:29 PM	#6
ModSocks Needs more middle fingers Join Date: Mar 2005 Location: San Diego Casino cash: $4264563	You guys remember when WWE tried introducing real boxing and only their C list wrestlers would sign up, and then they all looked like complete pussies who couldn't take a punch? Good times. __________________ Life is like a dick. Sometimes it gets hard for no reason, but it can't stay hard forever.
Posts: 64,345

04-03-2023, 02:48 PM	#8
Vladimir_Kyrilytch Veteran Join Date: Sep 2021 Casino cash: $2750400	As long as Joe Rogan is still the announcer I will be a viewer, mergers be damned!
Posts: 2,398

04-03-2023, 02:51 PM	#9
bdj23 In my youth i pray to keep Join Date: Nov 2013 Location: Clown World Casino cash: $2689850	Didn't they try to turn Undertaker into an MMA fighter for a while?
Posts: 15,738