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WWE and the company that runs the Ultimate Fighting Championship will merge to create a $21.4 billion sports entertainment company.
A new publicly traded company will be formed that houses the UFC and WWE brands, with Endeavor Group Holdings Inc. taking a 51 percent controlling interest in the new company. Existing WWE shareholders will hold 49 percent of the stock.
The company values UFC at $12.1 billion and WWE at $9.3 billion.
The new business, which does not yet have a name, will be led by Endeavor CEO Ari Emanuel. Vince McMahon, the executive chairman of WWE, will serve in the same role in the new company. Dana White will continue as UFC president and Nick Khan will continue as WWE president.
“Together, we will become a $21+ billion live sports and entertainment center with a collective fan base of more than one billion people and exciting growth opportunities,” McMahon said in a prepared statement Monday.
He also gave some ideas on the new company’s focus, saying it will expand the value of its combined media rights, increase monetization of sponsorships, develop new content and pursue other strategic mergers and acquisitions to further expand. brand.
The announcement comes after McMahon, WWE’s founder and majority shareholder, returned to the company in January and said it was open to sale.
Rumors swirled about who might be interested in buying WWE, with Endeavor, Disney, Fox, Comcast, Amazon and Saudi Arabia’s Public Investment Fund all in the mix.
WWE is an attractive acquisition
Media industry analysts see WWE as an attractive acquisition target due to its global reach and loyal fan base, which includes everyone from children to seniors and high 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 authority. This surpasses the 16 billion views of social videos in the last quarter of last year. It has almost 94 million YouTube subscribers and has more than 20 million followers on TikTok. The female wrestler is among five of the 15 most followed female athletes in the world, on 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 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 ticker symbol “TKO”. The board will have 11 members, six appointed by Endeavor and five appointed by WWE.
“We like the assets of the UFC and also the WWE in a world where linear TV is losing market share to streaming, thus live sports content in high demand,” wrote Jeffries analyst Randal Konik 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, Conn., fell more than 8 percent before the opening bell. Shares of Endeavor, based in Beverly Hills, California, rose nearly 3 percent.
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