Acquisition of WWE by Endeavor
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 | |
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| Initiator | Endeavor |
|---|---|
| Target | WWE |
| Type | Full acquisition |
| Cost | US$9.3 billion |
| Initiated | April 3, 2023 |
The acquisition of WWE by Endeavor began on April 3, 2023, when Endeavor Group Holdings, owner of the Ultimate Fighting Championship (UFC) mixed martial arts promotion, announced it would acquire WWE, the world's largest professional wrestling promotion. The deal, estimated to be worth US$9.3 billion, will merge the two promotions into a new company. However, both WWE and the UFC will continue to operate as separate divisions of the new company. The merger is expected to be finalized by the second half of the year.
Background[edit]
Ultimate Fighting Championship[edit]
The Ultimate Fighting Championship (UFC) is a mixed martial arts promotion founded by businessman Art Davie and martial artist Rorion Gracie in 1993.[1] In 2001, the UFC—then a failing company—was acquired by Station Casinos executives Frank and Lorenzo Fertitta from Semaphore Entertainment Group for US$2 million. The Fertittas created the company Zuffa to manage the business, and instilled Dana White as president.[2] In May 2016, ESPN reported that several companies, including WME-IMG, were in talks to acquire the UFC. White refuted these claims, telling the Las Vegas Review-Journal that "the UFC is not for sale". ESPN estimated that the UFC was valued between US$3.5 billion to US$4 billion at the time.[3]
In July 2016, WME-IMG gained a controlling share of the UFC for US$4 billion. Backed by investment firms Silver Lake Partners, Kohlberg Kravis Roberts, and MSD Capital, it was the largest-ever acquisition in sports at that point.[4] The Abu Dhabi government retained its 10% stake in the company.[5] In October 2017, WME-IMG announced it had formed a new company known as Endeavor and moved its assets to the nascent company. CEO Ari Emanuel and chairman Patrick Whitesell retained their positions.[6]
In April 2021, Endeavor launched an initial public offering and became a publicly traded company on the New York Stock Exchange.[7] Endeavor subsequently acquired the UFC as a whole.[8]
WWE[edit]
WWE is a professional wrestling promotion, originating from the Capitol Wrestling Corporation (CWC) of the 1950s, run by Vincent J. McMahon, son of boxing promoter Jess McMahon.[9][lower-alpha 1] CWC's successor, the World Wide Wrestling Federation (WWWF), was formed by Vincent J. McMahon in 1963 after he pulled CWC out of the National Wrestling Alliance (NWA) in protest of Buddy Rogers losing the NWA World Heavyweight Championship to Lou Thesz.[11][12] McMahon assumed full control of the company in 1971 following the departure of business partner and wrestler Toots Mondt.[13] In March 1979, the WWWF was renamed to World Wrestling Federation (WWF), and in May 2002, it was renamed to World Wrestling Entertainment (WWE); since April 2011, the company has branded itself solely under the trade name of WWE.[12] Following the acquisition of CWC, the holding company for the WWF, in 1982 by Vince McMahon, Vincent's son, Vince and other members of the McMahon family have held significant interest within WWE.[14]
On June 17, 2022, amid allegations that he paid hush money to a former employee, McMahon stepped down as the chairman and CEO of WWE, leaving the company to his daughter, Stephanie McMahon, and Nick Khan.[15] McMahon returned to the board in January 2023 ahead of media negotiation rights with Fox Broadcasting Company and USA Network.[16] Reports later emerged that McMahon returned to seek a potential buyer for the WWE, hiring financial services firm JPMorgan Chase. Among the suitors involved in a potential acquisition included Endeavor.[17]
Acquisition[edit]
On April 2, 2023, on the final day of WrestleMania 39, CNBC reported that Endeavor (who were among many bidders to buy WWE) and WWE were in talks for the former to acquire the latter.[18] Endeavor CEO Ari Emanuel confirmed the deal the following day on April 3, announcing that the UFC and WWE would be merging into one company.[19][20]
As part of the acquisition, Endeavor will hold a 51% stake in the new company—tentatively referred to as "NewCo." and tentatively planned to trade under the symbol "TKO"—with WWE's shareholders having a 49% stake.[21] This will mark the first time that WWE has not been majority-controlled by a member of the McMahon family.[18]
Despite the merger, the two promotions, WWE and the UFC, will continue to run as separate divisions of the newly merged company as per statements made by WWE CEO Nick Khan.[22]
Criticism[edit]
Hours after the sale, law firm Ademi LLP launched its own investigation into the sale, looking for "possible breaches of fiduciary duty and other violations of law." while the stock of WWE became lower.[23]
Notes[edit]
References[edit]
Citations[edit]
- ↑ Snowden, Jonathan (November 12, 2018). "UFC 1, 25 Years Later: The Story Behind the Event That Started an Industry". Bleacher Report. Retrieved April 3, 2023.
- ↑ Snowden, Jonathan (July 11, 2016). "For Dana White and Fertittas, UFC Sale Leaves Behind Complex Legacy". Bleacher Report. Retrieved April 3, 2023.
- ↑ Royell, Darren (May 10, 2016). "Sources: UFC owners in advanced talks to sell business". ESPN. Retrieved April 3, 2023.
- ↑ de la Merced, Michael (July 11, 2016). "U.F.C. Sells Itself for $4 Billion". The New York Times. Retrieved April 3, 2023.
- ↑ Rovell, Darren; Okamoto, Brett (July 10, 2016). "Dana White on $4 billion UFC sale: 'Sport is going to the next level'". ESPN. Retrieved April 3, 2023.
- ↑ Kroll, Justin (October 9, 2017). "WME-IMG Renames Holding Company Endeavor". Variety. Retrieved April 3, 2023.
- ↑ Okamoto, Brett (April 29, 2021). "UFC parent company Endeavor goes public with stock sale". ESPN. Retrieved April 3, 2023.
- ↑ Kasabian, Paul (March 31, 2021). "Endeavor Agrees to Acquire Full Control of UFC After Previously Owning 50.1%". Bleacher Report. Retrieved April 3, 2023.
- ↑ Pantaleo, Sullivan & Elliot Greenberg 2016, p. 372.
- ↑ Krugman 2009, p. 11.
- ↑ Grasso 2014, p. 203.
- ↑ 12.0 12.1 Johnson, Stephan (July 20, 2009). "What If the WWE Never Existed?". Bleacher Report. Retrieved April 3, 2023.
- ↑ Solomon 2015, p. 161.
- ↑ Hornbaker 2018, p. 52.
- ↑ Victor, Daniel (June 17, 2022). "Vince McMahon Steps Down as Head of W.W.E. During Misconduct Investigation". The New York Times. Retrieved April 3, 2023.
- ↑ Coppinger, Mike (January 5, 2023). "Vince McMahon back at WWE ahead of media rights negotiations". ESPN. Retrieved April 3, 2023.
- ↑ Sherman, Alex (January 7, 2023). "Vince McMahon is back at WWE to ensure a smooth sale process. Here's who might want to buy it". CNBC. Retrieved April 3, 2023.
- ↑ 18.0 18.1 Sherman, Alex (April 2, 2023). "WWE near deal to be sold to UFC parent Endeavor, sources say". CNBC. Retrieved April 3, 2023.
- ↑ Valinsky, Jordan (April 3, 2023). "WWE is combining with UFC to form a new company". CNN. Retrieved April 3, 2023.
- ↑ Mullin, Benjamin (April 3, 2023). "Endeavor and W.W.E. Join Forces to Create Live-Combat Tag Team". The New York Times. Retrieved April 3, 2023.
- ↑ Sherman, Alex (April 3, 2023). "WWE agrees to merge with UFC to create a new company run by Ari Emanuel and Vince McMahon". CNBC. Retrieved April 3, 2023.
- ↑ Burack, Bobby (April 3, 2023). "WWE CEO NICK KHAN TALKS WWE/UFC MERGER". OutKick. Retrieved April 5, 2023.
- ↑ https://www.wrestlinginc.com/1248396/law-firm-announces-its-investigating-wwe-over-endeavor-sale/
Bibliography[edit]
- Grasso, John (2014). Historical Dictionary of Wrestling. Lanham: Scarecrow Press. ISBN 9780810879263. Search this book on
- Hornbaker, Tim (2018). Death Of The Territories: Expansion, Betrayal and the War That Changed Pro Wrestling Forever. Toronto: ECW Press. ISBN 9781773052328. Search this book on
- Krugman, Michael (2009). Andre the Giant: A Legendary Life. New York City: Simon & Schuster. ISBN 9781439188132. Search this book on
- Pantaleo, Steve; Sullivan, Kevin; Elliot Greenberg, Keith (2016). WWE Encyclopedia of Sports Entertainment (3rd ed.). Shreveport: Prima Games. ISBN 9781465453136. Search this book on
- Solomon, Brian (2015). Pro Wrestling FAQ: All That's Left to Know About the World's Most Entertaining Spectacle. Lanham: Backbeat Books. ISBN 9781617136276. Search this book on
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