Vince McMahon Back WWE to Help With Potential Sale Process

Vince McMahon is back in the World Wrestling Entertainment Board of Directors to facilitate sale talks in advance of company’s media rights renewal.

The The idea that WWE is selling merchandise isn’t new. CNBC reported that it looked like a sale target in April And that it appeared only more attractive in July After a sexual misconduct scandal. The The logic is simple: WWE is valuable intellectual capital.

Owning IP allows streaming services the freedom to offer exclusive content without the hassle of bidding in an auction every few year. WWE has a lot to offer in the merchandising and theme-park businesses.

According to people familiar, WWE hired JPMorgan to advise it on a possible sale. JPMorgan declined to comment. WWE could not immediately be reached for comment.

If The people said that if a deal is reached, it would likely happen within the next three to six-months. They asked not to be identified because the discussions are confidential. WWE will meet with potential buyers before making a decision on TV rights renewal deals.

McMahon’s expected return should help the sale process go smoothly, but there could still be hiccups.

The Former CEO and chair is now 77 years old. He is also the controlling shareholder in WWE. He After an investigation He had paid the money. nearly $15 million to four women over 16 years To stop alleged sexual misconduct or infidelity. Returning The board will give potential buyers the confidence that he is supportive of the details of any transaction.

“My return will allow WWE, as well as any transaction counterparties, to engage in these processes knowing they will have the support of the controlling shareholder,” McMahon stated in a statement Thursday.

McMahon’s departure won’t affect the current leadership. McMahon’s daughter, Stephanie, and a former CAA agent Nick Khan are co-CEOs. But It is not clear what role McMahon would like at WWE if he sells the company. WWE has told investors that McMahon’s role at the company is essential in “our ability to create popular characters and creative storylines.” CurrentlyMcMahon does not have any formal role in the company’s creative direction.

Whether A buyer would be happy for McMahon to take a more hands-on position at the company. But WWE is McMahon’s passion. It’s Possible that a sale is only possible with some strings attached.

After nearly 17 years of growth, WWE’s market capitalization has reached more than $6B.% Percent FridayBoosted by increased sale speculation.

There are three categories of likely buyers for WWE — the legacy media companies, the streamers and the entertainment holding companies. Here’s Who might be interested.

ComcastNBCUniversal is a potential buyer for WWE. McMahon has an exclusive streaming deal already with NBCUniversal. Comcast’s Service streaming Peacock, and a deal for cable TV with NBCUniversal USA Network. Comcast has a market capitalization of more than $160 billion and can easily afford the company — especially with a $9 billion (or more) check coming as soon as January 2024 from Disney for a 33% stake in Hulu.

Comcast WWE can be locked up in perpetuity without the need to pay future rights renewal increases. The company’s IP can also be used for movies and theme parks as well as other spinoff series.

Still, Comcast CEO Brian Roberts In October “the bar is the highest it’s been in terms of M&A” He has repeatedly stated that the company isn’t in a hurry to acquire another company.

Returning CEO Bob Iger He may be looking to make a splashy purchase as he retakes control of the throne Disney. WWE Fits Disney In the same way it fits Comcast. It This would boost Disney’s It would support the linear network business and add some weight to the merchandizing or theme park businesses.

Comcast I didn’t want Disney Walking away with Fox In 2019, drove up the price by tens of billions by topping Iger’s initial bid. Could Iger WWE will be the next IP fight between the two sides. Disney His rival Comcast?

Netflix He has been averse to sports and other live events for a long time. it’s recently become open to the idea of owning a league outright or taking an ownership stake. Owning A sports league would offer Netflix The ability to create video games without friction. Netflix It has been a huge success Formula 1 “Drive to Survive” Documentary series that gives co-CEOs insight Reed Hastings Faith that certain sports properties will resonate well with Netflix’s huge global audience. But Netflix Doesn’t own Formula 1. Limiting its future options.

Acquiring WWE or another sports league would be a path toward offering live entertainment without renting content — similar to Zaslav’s thinking.

“We’ve not seen a profit path to renting big sports,” co-CEO Ted Sarandos last month at the UBS Global TMT Conference. “We’re not anti-sports; we’re just pro-profit.”

EndeavorSuperagent runs the. Ari Emanuel, could add WWE after-sales assets agreeing to buy 100% of UFC in 2021.

Emanuel UFC was bought to expand the business of the talent agency to live events. WME-IMG is now a small part of Endeavor, represents many UFC athletes — as well as WWE superstars. The UFC deal was a success EndeavorThe UFC paid approximately seven times the $600 million revenue in 2016 for 2016. UFC generated more than $1 billion in revenue in 2022.

Endeavor’s WWE is a major success because of its enterprise value of approximately $11 billion. The The company’s small balance sheet would likely prevent them from being able to pay their bills. Endeavor A bidding war against media giants. But McMahon may be a great fit for McMahon’s outsized personality. Emanuel UFC President Dana White.

Selling A third party would also allow WWE the ability to renew rights every few years. That As the media distribution ecosystem changes, this may be a positive or negative for the company’s long-term future.

While Endeavor UFC owns it, Liberty’s Formula One Group Owns Formula 1. John Malone, Liberty’s Controlling shareholder and CEO Greg MaffeiAlong with Formula 1 CEO Stefano DomenicaliThey have also figured out how to market the car racing league globally, including cracking American Culture after decades in obscurity

Malone And Maffei We have a proven track record of maximizing media valuations and acquiring media assets less than $10 billion. Formula 1, Sirius XM Pandora. The Global success of Formula 1 could be a roadmap for a future WWE strategy.

Disclosure: Comcast NBCUniversal, CNBC’s parent company, is owned by NBCUniversal.

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