WWE is gearing up to sell.
On January 12, WWE announced that they were engaging with outside advisors to review strategic alternatives. Upcoming media rights negotiations were the reason given for WWE going to outside advisors, but reports indicated that WWE was also preparing to sell the company.
Vince McMahon returned to WWE on January 6 as a member of the board of directors. McMahon claimed, as the controlling shareholder, he needed to return to help lead the upcoming round of media rights negotiations.
Appearing on the Bill Simmons Show, Nick Khan addressed reports of WWE looking to sell.
He began by shooting down the rumor that WWE had sold to Saudi Araba and that the company was going to be private again.
"100% fake, 100% made up saying there was an imminent transaction. Totally false. It was absurd, it was nuts. That person subsequently took down that tweet because when I'm saying it was 100% false, it was 100% false," he said.
Asked about Vince's involvement, Khan said, "In this process, he's there to oversee it, it's his controlling share, I'm involved in it, Triple H is in involved in it, the board is obviously involved in it. We're going to see how it plays out. It should not be a lengthy process."
Khan continued, explaining the guidelines WWE has to follow with a sale as a publicly traded company.
"The thing about the rules, privately held, publicly traded, whatever it is, the founder CEOs are inherently not rule followers. They should follow the law because no one wants a problem with that. In terms of the rules, I didn't see you [Simmons] following that many rules at your prior employer. You sort of did it the way you thought it needed to be done and ultimately your work stood out. To follow those rules, I would have to imagine was difficult for a period of time to get your head wrapped around them. Not as difficult for us because the company has been publicly traded for so long and you understand that the rules are really the SEC rules and nobody wants to violate any of those. So the imminent announcement that it's been sold already or [made private], of course, if you're looking at it and connecting the dots, it made absolutely no sense. In terms of what the actual process may be, we're just starting it now," he said.
When asked why Vince McMahon would want to sell the company at this point, Khan replied, "I think he's ready. I can't describe it as anything more than that after the last five months. Keep in mind, you [Simmons] engage in empire building, you're still engaged in empire building. At a certain point, it's like, how much of this empire am I going to build? We continue to build it, he continued to build it until he stepped down five month ago. In looking at a world of consolidation, the stand alone enterprise that owns 99% of its intellectual property with the media rights coming up in October 2024, which means the process starts in a few months on that, to certainly go lock in a bunch of long-term deals, and then to try to sell to everybody doesn't make sense. The timing is now. That's the goal, unless one of the media conglomerates ends up buying it directly, then they certainly wouldn't want it encumbered by any long-term media rights deals elsewhere."
WWE's media rights deals with USA Network (WWE Raw) and Fox (WWE SmackDown) expire in 2024.
Asked if Vince may only sell part of the company, Khan said, "That's in play. When he's using the term 'strategic alternatives,' it's basically we're looking at everything. If he said, I'm looking to sell the company, what does that mean? A piece of it, all of it? Do you merge the company? Do you buy another company instead of selling? Do you sell the company outright? A lot of it will come down to price, but I don't think all of it. It's what's the best value for the shareholder? What's the best value for Vince after the shareholder. So the stock, after the announcement, is flying high, how much more is somebody going to offer on that, that makes it a transaction that he wants to do?"
Comcast, Fox, Netflix, Amazon, Disney, Warner Bros. Discovery, and more have been listed as potential suitors to purchase WWE. Khan stated that it could be a strategic media company or it could be someone with deep pockets, noting how Mat Ishbia purchased the Phoenix Suns.
WWE has stated they do not intend to comment further until the process has concluded or the Company has otherwise determined that further disclosure is appropriate or required.
Elsewhere during the interview, Khan discussed Vince's return to the company. You can find his full comments by clicking here.
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