Officials at UFC parent company Endeavor and WWE on Monday confirmed the UFC-WWE merger. Reports surfaced over the weekend that the two sports entertainment juggernauts had agreed to a deal in principal for Endeavor to purchase WWE, bringing it under the same umbrella as the UFC.
The UFC and WWE will continue to operate under the umbrella of a newly formed publicly traded company that has yet to be named. The new company is expected to trade under the TKO ticker symbol on the stock market.
How the UFC-WWE Merger creates a $21.4 Billion powerhouse
WWE has been shopping for a buyer for quite a while, but landed in a deal with Endeavor that simply made sense to both parties.
“The immense success we’ve already had in partnering with their team on a number of ventures, I believe that this is without a doubt the best outcome for our shareholders and other stakeholders,” said Vince McMahon, Executive Chairman of WWE.
“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.”
That number was confirmed in a joint press release from Endeavor and WWE. The release notes that the transaction values the UFC at $12.1 billion and the WWE at $9.3 billion. The UFC-WWE merger effectively creates a $21.4 billion company that is expected to increase its worth rapidly.
There are many synergies between the two companies, but each has its own distinct fan base. UFC and WWE have worked together in the past. WWE superstar is one of the few pro wrestlers to be given an immediate shot in the UFC. And UFC superstar Ronda Rousey made an immediate splash in WWE with her transition to professional wrestling.
The overlap between the two companies’s fan bases should increase once the two begin operating under the same corporate structure. There will be many opportunities for cross promotion, increased leverage to attract sponsors and other revenue generating ventures, and operations consolidations that will reduce overall expenses.
The UFC and WWE expect to realize $50 million to $100 million in run rate cost synergies. Which is, essentially, cost savings achieved by eliminating redundancy and combining efforts in common company interests.
“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.
What is Dana White’s fate following UFC-WWE Merger?
UFC president Dana White will continue to head the company following the UFC-WWE merger. Though much restructuring will take place, he and other officials from the UFC, WWE, and Endeavor already have their leadership paths outlined.
The unnamed new company, according to Endeavor, “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.”
Did Dana White miss out on a $1 Billion Payday?
White is currently under contract with Endeavor to run the UFC through 2026. But his employment isn’t believed to include any of the ownership stake that he once enjoyed. He is believed to currently be paid in the neighborhood of $20 million per year based on a reported 9% share of profits the UFC produces.
At the time that Zuffa sold the UFC to Endeavor (then WME-IMG) for slightly more than $4 billion, White owned a 9% stake in the UFC. He sold some of that stake to WME-IMG at the time of purchase. Whatever remained, he then sold in a later deal when Endeavor wanted to take the company public. so White is now believed to have no ownership.
Based on the UFC-WWE merger transaction value of $12.1 billion for the UFC, had White held onto his 9% stake in the company until now, he would be worth $1 billion.
Though that’s not the case, White’s net worth is still estimated to be more than $500 million. The ownership of the new company will consist of Endeavor owning 51% of the stock, while WWE stockholders will make up the remaining 49% ownership.
The deal has been agreed upon by Endeavor’s and WWE’s executive boards, but is pending regulatory approval. The UFC-WWE merger is expected to be finalized in the second half of 2023.
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Confirmed! UFC-WWE merger creates “$21 Billion powerhouse”
