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Vince McMahon stepped down as Chairman and CEO of WWE on Friday amid a board investigation into “hush money” McMahon paid to suppress allegations of sexual misconduct.
When the shock of the news wears off, industry discussion will inevitably turn to a potential WWE sale. There has long been speculation that McMahon, who is remaining the majority shareholder, was gearing up to sell the company.
As we wrote earlier this year, pre-scandal, the wrestling business is surging in value. Monday Night Raw consistently ranks among the top shows on cable, and SmackDown averages around 2 million viewers a week.
For context, WWE routinely beats the NBA in the ratings.
WWE’s greatest selling point, however, is its streaming property. Wrestling is a valuable chip in the streaming wars.
In 2021, WWE licensed its streaming content — which includes an extensive library and exclusive rights to all upcoming pay-per-view events — to NBCUniversal’s Peacock in a deal worth $1 billion.
Our reporting in March found the following:
Nearly all of WWE Network’s former 1.1 million subscribers have converted to Peacock, and more than three million Peacock subscribers have watched WWE content since March 2021. Most notably, more than half of those three million subscribers say that they signed up for Peacock “because of WWE.”
WWE also has a YouTube page with just under 90 million subscribers. These are alluring and monetizable properties for a list of media companies.
A reasonable purchase price for WWE could be around $7.5 billion. The company has a market cap of $4.73 billion and a current stock price of $66.69.
Therefore, there should be a number of possible sale partners, with Comcast’s NBCUniversal at the top of the list.
In addition to a deal for Peacock, the NBC-owned USA Network airs Raw on Mondays, keeping the network relevant in the pantheon of cable charts.
NBC pays $265 million a year to rent Raw essentially. Owning the WWE outright would prove sufficient long-term, eliminating the increasingly high fees to broadcast the properties on USA and Peacock.
NBCUniversal could then move SmackDown from Fox, a competitor, to its NBC broadcast network.
Disney is another potential buyer. In April, CNBC reported that Disney views niche sports like WWE as enticing acquisition targets.
This is where the streaming business comes into play, again. WWE would bolster the demand for either Hulu or ESPN+, just as the UFC has.
Disney could air the weekly WWE television shows on any combination of its linear networks, including ABC, FX, and ESPN (probably ESPN2).
The juiciest storyline is AEW owners Tony and Shad Khan swooping in, overpaying, and owning the US wrestling industry. Imagine that for a story. Never say never, as they say in wrestling.
Other wild card buyers may include Amazon, Apple, Netflix, Fox, and Endeavor Group Holdings.
In some ways, WWE is now the story to watch in both media and content.