A sizable document offers new information about WWE‘s deal with Endeavor.
Per SEC filings, WWE entered into a transaction agreement with Endeavor, UFC’s parent company, on April 3. As part of this deal, WWE will form a new publicly traded company with UFC. A 550-page prospectus was made available on May 12, and it contains information about the deal as it relates to current WWE stockholders.
According to the prospectus, “over 60 potential counterparties, including strategic companies, financial sponsors, family offices and sovereign wealth funds” were in contact with WWE about a potential transaction between January 17 and April 2. WWE made confidentiality agreements with 20 potential counterparties between February 6 and May 21.
The filing states that WWE and Endeavor signed a mutual confidentiality agreement on February 7, and both parties conducted due diligence on each other. That day, Endeavor submitted a non-binding indication of interest in making a deal. On February 24, eight potential counterparties, including Endeavor, were asked for non-binding indications of interest.
WWE then continued to discuss a potential deal with Endeavor; Vince McMahon and Nick Khan met with Ari Emanuel and Mark Shapiro to discuss a potential merger between WWE and Endeavor’s holding company. At a WWE board meeting on March 2, the board decided that WWE should continue to explore alternative options while continuing its talks with Endeavor.
Eight potential counterparties submitted written indications of interest on March 13, and three of them were interested in acquiring WWE entirely. WWE subsequently told their financial advisors to engage with those who were interested in providing debt or equity financing. (H/t Brandon Thurston of Wrestlenomics.)
At a WWE board meeting on March 21, WWE’s financial advisors noted that, other than Endeavor, the potential counterparties would need external finances for a transaction. The next day, McMahon and Khan met with Emanuel and Shapiro again, where the WWE side presented the Endeavor duo with a term sheet. The discussions continued from there, with Endeavor’s legal advisor Latham giving WWE a revised term sheet, which included a stimulation that would see McMahon serve as executive chair until his death, resignation, or incapacity to continue. This was included as a condition for Endeavor getting 51% of the company and WWE shareholders keeping 49%.
WWE held a special board meeting to discuss the revised term sheet on March 27, and further changes were made. On March 30, two bidders other than Endeavor decided that neither wanted to be the lead investor. Neither “Strategic Party 1” nor “Financial Sponsor 1” made a bid, despite some consideration of a potential joint bid.
On April 1, WWE held another special board meeting. Though Triple H was absent due to WrestleMania, he informed management of his support following previous meetings. At the April 1 meeting, WWE’s financial advisors express that no other potential bids would be executable in the near future. The deal to merge WWE and UFC was finalized on the next day.
WWE’s deal with Endeavor is expected to close in the second half of 2023.
