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By Alan Snel, LVSportsBiz.com Publisher/Writer
Fresh off staging events in Las Vegas and Los Angeles, wrestling entertainer WWE has cut a major deal with Ultimate Fighting Championship owner Endeavor to form a new publicly listed company that will consist of both Las Vegas-based UFC and WWE.
Entertainment company Endeavor Group Holdings, Inc., of Beverly Hills, California, will control the new company with a 51 percent controlling interest, while WWE shareholders will own a 49 percent share in the new company.
Both fight brands are fueled by drama — some for entertainment purposes, some real — and have seen popular performers like Ronda Rousey and Brock Lesner do fight shows for both entertainment entities.
Both UFC and Stamford, Connecticut-based WWE generate annual revenue together of more than $2 billion. On a combined 2022 fiscal year-end basis, UFC and WWE achieved revenue of $2.4 billion and a 10 percent annual revenue growth rate since 2019, Endeavor said Monday.
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. — Vincent K. McMahon, Executive Chairman of WWE.
“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.
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.
Endeavor expects significant growth across revenue areas including domestic and international media rights, ticket sales and yield optimization, event operations, sponsorship, licensing and premium hospitality.
The deal 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, the announcement said.