WWE set to merge with UFC to create a new company

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— In a stunning turn of events, Vince McMahon’s family legacy, World Wrestling Entertainment, agreed to merge with UFC.

The merger would create a new publicly traded company under the control of the Endeavor Group.

The news

On Monday, WWE and UFC announced the big news, which would see Endeavor own a 51% stake in the new company.

According to the terms of agreement, WWE shareholders would have the remaining 49% stake.

A press release was published, stating the deal values McMahon’s company at $9.3 billion while the Endeavor-owned UFC is valued at $12.1 billion.

The transaction is anticipated to close in the second half of the year.

Earlier on Monday, WWE shares fell by more than 2%, while Endeavor dropped by 5%.

Internal changes

With the merger set in place, there will be little changes to the control of the two companies.

According to the companies, Ari Emanuel will serve as the chief executive of Endeavor and the new company.

Vince McMahon will take the role of executive chairman, while Mark Shapiro will remain in the same roles as Endeavor President and COO at the new company.

Dana White is also staying put as UFC president while Nick Khan remains the president of the wrestling business.

“This is going to be UFC 2.0,” said Emanuel.

The new company’s board will consist of 11 people, six from Endeavor and five from WWE.

The merger has yet to announce the name of the upcoming brand, but the company will trade on the New York Stock Exchange under the ticker symbol TKO.

Announcement of the deal came a day following WWE’s Wrestlemania event after months of searching for a buyer.

Vince McMahon returned as the company’s chairman in January to oversee the process.

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The deal

For fans of both brands, the deal is a dream come true, pairing two of the most prominent sports entertainment companies in the world.

While they have some major differences, the two companies also have similarities in content culture. 

Stars from both brands have tried their hand in the other, most notably Brock Lesnar and Ronda Rousey.

A major difference between the two is WWE holding storylines and scripted matches, while UFC shows a more brutal mixed martial arts sparring.

UFC champion Conor McGregor praised the news on Twitter, even posting a photo of him with the UFC and WWE championship belts.

The McMahon-run company provides Endeavor shareholders a muscular media, a live events business, and decades worth of intellectual property.

In 2022, the company generated a revenue of $1.29 billion, most of which came from its $1 billion media unit.

On Monday, Emanuel shared that Endeavor is familiar with the WWE business.

The company’s media rights deals for TV and streaming are set for renewal in the next few months.

Endeavor also owns the WME talent agency, using its expertise in celebrity, media rights, and live events to expand UFC’s revenue.

Furthermore, Emanuel shared that the company plans to use the same book as the McMahon-owned company.

“We have a track record of success with media rights,” he said.

“WWE has a similar scale to UFC. In the universe of assets at this scale, the opportunity is rare and finite.”

Emanuel added that the combined company could explore new direct-to-consumer opportunities.

The family legacy

Vince McMahon’s father founded the original incarnation of the company in the middle of the 20th century before he bought it in 1982.

In the past four decades, WWE grew into a global phenomenon, creating larger-than-life stars like Hulk Hogan, Dwayne “The Rock” Johnson, John Cena, and Dave Bautista.

“It’s a great day,” said McMahon following the deal.

“Things have to evolve. Family businesses have to evolve for all the right reasons.”

In July 2022, McMahon retired from the company after news emerged that he paid several women millions of dollars to stay quiet about alleged affairs and misconduct.

Throughout the summer, WWE revealed that other entities were probing the hush money payments.

Stephanie McMahon, his daughter, became co-CEO with Khan, while her husband Paul Levesque, best known as Triple H, was in charge of creative duties.

She only stepped down in January after Vince McMahon’s return, giving Khan the solo role of CEO.

A difficult process

Nick Khan spent weeks discussing the potential sale, revealing that the process attracted interested buyers.

Emanuel affirmed that the sale process was competitive.

Additionally, WWE aligned with the Endeavor and UFC cultures, a reflection of their leaders’ ‘hard-edged’ styles.