World Wrestling Entertainment, Inc. Chairman Vince McMahon was introduced at the WWE Monday Night Raw Show at the Thomas & Mack Center in Las Vegas, Nevada on August 24, 2009.
Ethan Miller | Getty Images
Vince McMahon is back world wrestling entertainment The Board facilitates potential sale negotiations prior to renewal of the company’s media rights.
The concept of WWE sales is nothing new. CNBC reported that he appeared to be for sale in April, only to appear more attractive after a sexual misconduct scandal hit in July. The reason is simple and clear. WWE is valuable intellectual property.
Owning IP allows streaming services to offer content exclusively without the hassle of winning license rights at auction every few years. WWE also has value to offer in its merchandising and theme park business.
WWE hired JP Morgan to help advise the company on a potential sale, according to people familiar with the matter. JP Morgan declined to comment. A WWE spokesperson could not be reached for comment.
If a deal is reached, it is likely within the next three to six months, said the people, who asked not to be identified because the information is private. WWE plans to speak with potential buyers before making any decisions about renewing the TV rights deal.
McMahon’s return should help the sales process run smoothly, but there can still be problems.
The former CEO and chairman is 77 years old and a controlling shareholder of WWE. He resigned after an investigation found he paid about $15 million to four women over a 16-year period to quell allegations of sexual misconduct and infidelity. A return to the board gives potential buyers confidence that he stands by the details of the deal.
“My return allows WWE and our trading partners to engage in these processes knowing that they will have the support of their controlling shareholders,” McMahon said in a statement Thursday.
McMahon’s return will not affect current leadership. McMahon’s daughter, Stephanie, and former CAA agent, Nick Khan, are co-CEOs. However, it remains unclear what role McMahon would like to play in WWE if he sells the company. McMahon currently has no formal say in the company’s creative direction.
Mansoor (below) competes with Mustafa Ali at World Wrestling Entertainment’s (WWE) Crown Jewels pay-per-view in Riyadh, Saudi Arabia on October 21, 2021.
Fayez Nurelddin | AFP | Getty Images
It’s unclear if buyers will be happy with McMahon taking a more hands-on role in the company. The sale may only be made subject to at least some conditions.
WWE Market Cap Exceeds $6 Billion After Rising Nearly $17% Friday’s percent was supported by increased selling speculation.
There are three categories of WWE buyers: legacy media companies, streamers and entertainment holding companies. Click here if you are interested.
comcastOwning NBCUniversal could be a good WWE buyer. McMahon’s company has an exclusive streaming deal with Comcast’s streaming service, his Peacock, and a cable TV deal with NBCUniversal’s his USA Network. Comcast’s market cap exceeds his $160 billion, especially since he’ll receive his $9 billion (or more) check from Disney in January 2024 for his 33% stake in Hulu. You can easily afford the company.
Comcast can permanently lock WWE without paying future rights renewal fees, allowing its IP to be used in theme parks, movies and other spin-off series.
Still, Comcast CEO Brian Roberts said in October that “it’s the biggest hurdle yet when it comes to M&A,” and has repeatedly said the company is in no rush to make an acquisition.
A returning CEO, Bob Iger, may want to make a splashy acquisition as he reclaims the throne. disneyWWE fits Disney as well as Comcast does. It will bolster Disney’s streaming ambitions (probably ESPN+), support its linear network business, and have some impact on its merchandising and theme park business.
Comcast doesn’t want Disney to let Fox go in 2019, pushing the price up by tens of billions of dollars by beating Iger’s initial bid. Can Iger see his WWE as his next IP battle between Disney and his rival Comcast?
Disney CEO Bob Iger attends the European Film Premiere of ‘Star Wars: The Rise of Skywalker’ at Cineworld Leicester Square in London, UK, 18 December 2019 .
Viktor Simanovich | Future Publishing | Getty Images
warner bros discovery
netflix has long shunned sports and other live events, but has recently opened up to the idea of outright owning or even taking ownership of a league. Netflix will be able to create video games and spin-off series frictionlessly. Netflix finds success with Formula 1 ‘Drive to Survive’ documentary series and co-CEO Reed Hastings is confident certain sports properties will resonate with his Netflix’s huge global audience . But Netflix doesn’t own Formula 1, which limits his options for the future.
Similar to Zaslav’s thinking, buying WWE and other sports leagues could be a way to offer live entertainment without renting content.
Co-CEO Ted Sarandos said at the UBS Global TMT conference last month, “We don’t see a profit path in big-sport rentals. We’re not anti-sport. We’re just trying to make a profit. “
Endeavor Group Holdings
effortIt is run by super agent Ali Emmanuel.
Emmanuel acquired UFC, expanding the talent agency’s business to live events. WME-IMG is now part of Endeavor and represents many UFC athletes and his WWE Superstars. The UFC deal was a success for Endeavor, paying out nearly seven times his $600 million earnings in 2016. UFC will generate over $1 billion in revenue in 2022.
Ari Emmanuel speaks on stage at the 2017 LACMA Art + Film Gala Honoring Mark Bradford and George Lucas presented by Gucci at LACMA November 4, 2017 in Los Angeles, California.
Stephanie Keenan | Getty Images Entertainment | Getty Images
Endeavor is only worth about $11 billion, so WWE has a lot of clout in the company. Due to the company’s relatively small balance sheet, Endeavor won’t be able to win a bidding war with the media giants. However, McMahon’s prodigious personality might suit cocky Emmanuel and UFC president Dana White.
Selling to third parties also allows WWE to increase rights renewal every few years. As the media distribution ecosystem changes, it may or may not be positive for the company’s long-term future.
Endeavor owns the UFC, Liberty’s Formula One Group owns Formula 1. Liberty’s controlling shareholder John Malone and his CEO Greg Maffei, along with Formula 1’s Stefano Domenicali, have come up with a way to market the car racing league globally.
Malone and Maffei have a track record of maximizing media valuations and acquiring media assets such as F1, Sirius XM and Pandora for less than $10 billion. Formula 1’s worldwide success could provide a roadmap for his WWE strategy in the future.
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
Watch: Jim Cramer gives his take on how Disney could perform this year