Endeavor Group Holdings Inc. is nearing a deal to acquire World Wrestling Entertainment Inc. for about $9 billion, according to people familiar with the matter.
The entertainment conglomerate plans to announce a deal with WWE this week and as soon as Monday, said one of the people, who asked to not be identified because the matter isn't public. It's possible talks could still fall through, the people added. Representatives for Endeavor, WWE and McMahon declined to comment.
Endeavor has been pursuing WWE for the past few months, eager to combine the wrestling league with its Ultimate Fighting Championship and become the undisputed king of combat entertainment. Endeavor Chief Executive Officer Ari Emanuel believes he can use his company's existing expertise and resources in negotiating media rights and staging events all over the world to increase sales and cut costs at WWE.
Endeavor will be the majority shareholder of the new company and Emanuel will serve as CEO, the people said. Emanuel will also remain the CEO of Endeavor, CNBC reported earlier, along with the companies nearing an agreement.
McMahon Remaining
Vince McMahon, WWE's 77-year-old controlling shareholder, has run WWE for four decades. He will remain involved in the business after the deal, as will Nick Khan, the company's CEO.
McMahon reinstated himself as executive chairman in January to oversee a strategic review of the company. He left the firm last year following revelations that he had paid millions of dollars to settle sexual misconduct claims. While he was gone, the leadership of the company began to discuss strategic options ahead of the next round of negotiations with companies that air WWE matches on TV.
WWE is a rare prize in media. Though it is scripted entertainment, it delivers a live audience for its events akin to a sporting event. Fox Corp. and Comcast Corp. pay hundreds of millions of dollars a year for the rights to show the matches. The sale is being finalized against the backdrop of Wrestlemania, one of the biggest events on WWE's calendar. This year's event is being held across two days in Los Angeles.
Sale Expectations
WWE shares have climbed 33% this year as investors expected a sale. They rose 0.7% to close at $91.26 in New York trading Friday, giving it a market value of about $6.8 billion. McMahon was looking to get as much as $9 billion for WWE in a sale, Bloomberg News reported in February.
Emanuel and his leadership team have transformed Endeavor over the years from its roots representing Hollywood actors into a multi-faceted media company. They represent athletes, sell media rights to sporting events and own live events across sports and fashion. They also operate sports-betting technology company.
The firm went public in 2021 after scuttling an attempt at an initial public offering in 2019. Its shares closed Friday just 7 cents below their $24 IPO price, giving the company a market value of $11.3 billion.
UFC is the most valuable asset Endeavor owns, and now Emanuel has doubled down on combat sports.
Devoted Fans
WWE is a business like few others. It's a combination of sports and entertainment with devoted fans who show up to follow the story lines in and out of the ring. Some 80,000 fans turned out each of the two nights to fill SoFi Stadium in Los Angeles for the company's annual Wrestlemania. Fans even cheered the hosts at an outdoor stage during a pre-game show. Many of them sported gold championship belts that cost hundreds of dollars.
Pedro Calhau an IT worker from Portugal was attending his first Wrestlemania. He spent $400 for his belt, which was draped over his shoulder. "It's like a soap opera, it's like theater," Calhau said outside the stadium. "For us, it's a getaway." He said he thought the $9 billion was a fair price, adding "I hope they give back some to the fans."
