WWE about to merge cope with UFC mom Endeavor

World Wrestling Entertainment Inc. Chairman Vince McMahon appears in the ring during the WWE Monday Night Raw show at the Thomas & Mack Center August 24, 2009 in Las Vegas, Nevada.

Ethan Mueller | Getty Images

Vince McMahons World Wrestling Entertainment is in advanced discussions to sell to Ari Emanuel’s effort groupthe parent company of UFC, according to people familiar with the matter.

A deal could be announced as early as Monday. UFC and WWE are expected to form a new public company as part of the agreement, according to the people, who declined to be named due to the confidential nature of the talks.

Endeavor would own 51% of the new martial arts and entertainment company, while WWE shareholders would get 49%, the people said. The Endeavor deal gives WWE an enterprise value of $9.3 billion, they said.

Emanuel is expected to serve as Chief Executive of Endeavor and the new company. McMahon is also expected to serve as Executive Chairman, while Endeavor President Mark Shapiro will also serve in the same capacity at the new company. Dana White will remain President of the UFC, while WWE CEO Nick Khan will serve as President of the wrestling business.

Development is taking place the same weekend that WWE is hosting its flagship live event, WrestleMania, in California. The company has been looking for a buyer for the past few months. McMahon returned to the company as chairman in January to oversee the process. WWE stock is up more than 33% so far this year, taking it to a market value of more than $6.79 billion.

The deal will effectively end WWE’s decades-long status as a family business. McMahon’s father founded WWE in its original mid-20th century incarnation, and McMahon is the majority shareholder of the company. McMahon bought the company from his father in 1982. Since then, the company has grown into a global phenomenon that has produced stars like Hulk Hogan, Dwayne “The Rock” Johnson, Dave Bautista and John Cena.

McMahon, 77, retired from the company in July after following a series of revelations that he had paid women millions of dollars over the years to silence them about alleged affairs and wrongdoing. His daughter Stephanie McMahon became co-CEO alongside Khan. Paul Levesque, who is both Stephanie McMahon’s husband and the wrestler known as Triple H, took over Vince McMahon’s creative responsibilities.

When Vince McMahon returned in January, Stephanie McMahon stepped down and Khan assumed the CEO role fully. According to a securities filing, the elder McMahon recently signed a two-year employment contract.

Khan has been making media rounds over the past few weeks to discuss the potential sale. He told CNBC’s Morgan Brennan Thursday that it’s been a robust selling process that has attracted many interested buyers.

WWE brings with it a robust media and live events business, along with decades of intellectual property. The company generated $1.29 billion in revenue last year, driven primarily by its $1 billion media unit.

UFC paid off for Endeavor. Last year, the MMA league helped Endeavor’s sports business earn $1.3 billion. Endeavor’s market cap stood at approximately $10.53 billion as of Friday. Endeavor-WWE deal values ​​UFC at more than $12 billion.

WWE would also, at least on the face of it, fit well with the Endeavor and UFC cultures. McMahon has a brash public personality, making him a seemingly good match for Emanuel and White, who are also known for their oversized personalities.

Like McMahon, White is no stranger to scandal. Earlier this year, video surfaced showing the UFC boss hitting his wife during a public argument at a New Year’s Eve party in Mexico. White apologized.

Disclosure: Peacock, the streaming service of CNBC parent company NBCUniversal, broadcasts WWE events such as WrestleMania.

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