Photo: © Twitter/@muscle_fitness (Main Image)
On March 29th, 2023, the news broke that the UFC’s parent company, Endeavor Corp., is set to acquire WWE for $9.3 billion. This deal has been met with a mixed reaction from investors, who have not responded positively to the news. While Vince McMahon, WWE’s controlling shareholder, is set to make billions of dollars from the sale, the actual value of the company is being questioned by some investors.
At the announcement of the deal, Endeavor Corp. stated that the deal values WWE at $105.98 per share. This should have meant that Vince McMahon’s shares, which are worth more than $3 billion, would place him firmly on the Forbes 400 list of America’s richest people. However, WWE shareholders have sold off the company after the news, causing the share price to drop by as much as 9% on Monday. The share price closed down 2% at $89.30, which is a 16% discount to the stated deal valuation. As a result, McMahon’s WWE stake is now worth $2.57 billion, which is $477 million less than Endeavor Corp. says he should be worth.
The reason for the sell-off is not entirely clear, but there are a few possible explanations. Firstly, investors may have been hoping for an all-cash deal to make a clean profit. Secondly, the premium of 16% to the last WWE share price before the news is well below a more typical 28% or greater premium seen in arms-length acquisitions. Finally, WWE shareholders may find themselves holding the bill for Endeavor Corp.’s purchase of UFC. WWE has very little long-term debt, while UFC comes with a dowry of $2.74 billion in long-term debt, which moves with the MMA league to the new company.
Despite the sell-off, Vince McMahon’s return from a six-month retirement to guide WWE to a sale has paid off so far. WWE shares are about $8 higher than their November peak without the elder McMahon in charge. However, the share price may continue to decline in the months it will take to close the creation of the new company. Ultimately, in an all-stock deal, the value isn’t what Mr. McMahon says it is; it’s Mr. Market’s.
WWE has been a dominant force in professional wrestling for decades, with a loyal fan base and a roster of talented performers. Under Vince McMahon’s leadership, WWE has grown into a global entertainment juggernaut, with a wide range of business interests beyond professional wrestling. McMahon is known for his visionary leadership and his willingness to take risks, and he has been instrumental in the success of WWE.
Endeavor Corp. is the parent company of the UFC, which is a leading mixed martial arts organization. The acquisition of WWE is a significant move for Endeavor Corp., which is looking to expand its portfolio of sports and entertainment properties. The combination of WWE and UFC is expected to create a new powerhouse in the world of sports entertainment, with the potential to attract a massive global audience.
In conclusion, the sale of WWE to Endeavor Corp. for $9.3 billion is a significant development in the world of professional wrestling and sports entertainment. While Vince McMahon is set to make billions of dollars from the sale, the actual value of the company is being questioned by some investors. It remains to be seen how the new company will perform in the coming months and years, but it has the potential to be a major player in the world of sports entertainment.
Vincent Kennedy McMahon, better known as Vince McMahon, was born on August 24, 1945, in Pinehurst, North Carolina. He is the son of Vincent James McMahon, a successful wrestling promoter, and Victoria Askew. Vince McMahon grew up in a wealthy family and attended the military academy in New York, where he developed a passion for wrestling.
After graduating from college, McMahon began working for his father’s wrestling company, Capitol Wrestling Corporation (CWC), which later became the World Wrestling Federation (WWF). He worked his way up in the company and eventually took over as CEO in 1980.
Under McMahon’s leadership, the WWF became a major force in the wrestling industry. He is credited with creating the concept of sports entertainment, which blended wrestling with entertainment and drama. McMahon also helped to expand the WWF’s reach by launching the first WrestleMania event in 1985, which became an annual tradition and a huge success.
McMahon’s business acumen and innovative ideas helped to make the WWF a global brand. He was known for his controversial storylines and characters, such as “Stone Cold” Steve Austin, The Rock, and John Cena. McMahon also introduced new technologies, such as pay-per-view and online streaming, which helped to boost the company’s revenue.
Despite his success, McMahon faced many challenges in his career. In the late 1980s, he was embroiled in a steroid scandal, which led to a federal investigation and a trial in which he was ultimately acquitted. McMahon also faced stiff competition from rival wrestling company WCW in the 1990s, but he managed to overcome this by launching a new era of wrestling known as the “Attitude Era.”
McMahon’s career has not been without controversy, and he has been criticized for some of his business practices, including his treatment of wrestlers and his management style. However, he is widely regarded as a visionary who transformed the wrestling industry and made it a global phenomenon.
Outside of wrestling, McMahon has pursued various business ventures, including the launch of the XFL football league and the acquisition of the World Bodybuilding Federation. He has also made appearances in various TV shows and movies, including his memorable role in the film “The Marine.”
Despite his success in business, McMahon’s personal life has been marked by tragedy. His sister died of a drug overdose, and his son Shane survived a helicopter crash. McMahon’s marriage to Linda McMahon, who also worked for the WWF, has also been through its share of ups and downs.
Today, McMahon remains the CEO of WWE, which has since changed its name from WWF due to a legal dispute. He continues to be involved in the company’s creative decisions and has helped to launch the careers of many of wrestling’s biggest stars. McMahon is widely regarded as a legend in the wrestling industry and a true innovator who revolutionized the way we think about sports and entertainment.