Former World Wrestling Entertainment Inc. Chief Executive Vince McMahon, who retired last year following a sexual-misconduct scandal that ended his decades-long grip on the industry, is getting off the mat and plans to return and sell the company. His announcement late Thursday sent WWE shares soaring 21% Friday, putting them on pace for their best trading day ever.
McMahon, who is majority owner of the sports-entertainment empire that is valued at $ 5.2 billion, plans to elect himself and two former WWE WWE, +18.64% executives, Michelle Wilson and George Barrios, to the board.
“The only way for WWE to fully capitalize on this opportunity is for me to return as executive chairman and support the management team in the negotiations for our media rights and to combine that with a review of strategic alternatives,” McMahon said in a statement. “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 sent two letters in late December in which he expressed the urgency of his return, according to the press release.
The return of McMahon, 77, and the others would require three current directors to vacate their positions.
Fox Corp. FOXA, +2.61% and Comcast Corp.’s CMCSA, +2.66% NBCUniversal are seen as possible suitors for the media business, which racked up record revenue of $ 1.09 billion and record profit of $ 180 million last year, though potential buyers might have some serious misgivings, say longtime wrestling observers.
“Today, we announce that the founder of WWE, Vince McMahon, will be returning to the Board,” said Chair and co-CEO Stephanie McMahon, co-CEO Nick Khan and Chief Content Officer Paul Levesque in a statement Friday. “We also welcome back Michelle Wilson and George Barrios to our Board of Directors. Together, we look forward to exploring all strategic alternatives to maximize shareholder value.”
The board had previously rebuffed an attempt from McMahon to return to the company.
“[Vince] certainly has the voting power,” Brandon Thurston, a reporter at Wrestlenomics, told MarketWatch. “I imagine his adversaries may throw obstacles in his way. The big questions are whether the federal government can impede him or the company due to the unrecorded expenses or other misgivings, and whether NBCU, Fox or other potential media partners want to work with a company led by someone with seven known sexual-misconduct allegations against him.”
McMahon retired last summer amid charges of sexual misconduct that included nondisclosure-agreement payments totaling $ 19.6 million. McMahon used personal funds for the NDA payments but failed to record those expenses.
WWE, whose popular programming is a weekly fixture on Fox and USA Network, has indicated a willingness to explore deals. WWE’s rights deals with Fox and USA expire next year, with negotiations expected to begin later in 2023.
“We’re open for business on anything and everything, and even some of the business plans that we’ve announced recently, I think, are different or unique to what the company has traditionally done,” Khan said on the Recode Media podcast in August 2021. “So we’re open for business. If somebody calls, we’ll listen, but we’re not active. We’re not out in the marketplace trying to change that structure.”
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