The deal unites two of the biggest names in wrestling and entertainment and caps a months-long sale process for WWE. — Bloomberg
LOS ANGELES: World Wrestling Entertainment (WWE) Inc will combine with Endeavor Group-owned mixed martial arts franchise UFC to form a new, publicly listed entertainment giant valued at about US$21bil (RM92.4bil), the companies say.
The deal unites two of the biggest names in wrestling and entertainment and caps a months-long sale process for WWE, overseen by its co-founder and executive chairman Vince McMahon who returned to the company’s board in January.
“This is a once-in-a-lifetime opportunity to bring together two leading pure-play sports and entertainment companies,” Endeavor CEO Ari Emanuel said in an investor presentation, describing the deal as a “transformational step” for Endeavor.
Emanuel said he would capitalise on Endeavor’s expertise in securing media deals, sponsorships and new forms of distribution to fuel growth at the new company, which he will lead as chief executive officer while continuing in his role at Endeavor.
McMahon will retain his role in the new company, which will be majority-owned by Endeavor with a 51% stake, while WWE investors will own the rest.
WWE, which kicked off a strategic review in January, attracted several potential buyers who put in all-cash bids, but the company favoured a tie-up with Endeavor, as an all-stock deal was more attractive due to the potential upside in the share price of the combined entity, according to people familiar with the matter.
Shares of WWE closed down 2.1% at US$89.30 (RM393) on Monday, while Endeavor shares closed 5.9% lower at US$22.52 (RM99). The complex, all-stock structure of the deal surprised investors who were expecting an all-cash transaction, according to analysts and sources familiar with the matter. — Reuters
