When Vince McMahon returned to the WWE board of directors last month, he did so under the stated premise of exploring selling the company in order to maximize shareholder value.
The problem with this claim, of course, is that McMahon’s return poses a risk to the WWE brand as a result of last year’s money hush-money scandal and multiple allegations of sexual misconduct against him. This negative risk to shareholders is why the board denied its original request to return in December.
Given the nature of the power grab Vince ended up with again as CEO of the board of directors, many wrestling fans are wondering if Vince would have agreed to the sale if he wasn’t guaranteed a position of power as part of the deal. In other words, would Vince be okay with selling the company and then vanishing again?
WWE CEO Nick Khan was asked to change that question in an investor call today. And according to Khan, there is a stipulation under which McMahon will step down from WWE again if the sale goes through.
Khan was asked the following question: “Can you tell investors with certainty that Vince would be willing to end his involvement with WWE following the deal, if it gives shareholders the most value?”
Here is his response:
“Yes, without question. He announced it to the board. He announced it to us in management. It’s all about shareholder value. He’s obviously a shareholder, so it’s not about what role he’s going to play, it’s about maximizing that value opportunity.”
I don’t think for a moment that Vince jumped through all of these hoops to return to WWE only to go away again in a matter of months. It is important to note that Khan is not suggesting that this is what would happen if the sale went through.
The question specifically includes a conditional statement about maximizing shareholder value. Vince’s return to WWE is heavily focused on this formulation. This is why it would be easy for Khan to say that Vince would end his involvement with WWE if it was giving shareholders the most value. There likely wouldn’t be a scenario in which Vince McMahon decides his absence from the company is best for shareholder value, so the condition in question would not be met.
Moving forward, Khan said that finding the right partner to sell WWE is more than just the company making the biggest financial bid. This is what WWE is looking for in a buyer:
“A partner who has more than just deep pockets. So he’s a partner who understands the media business, and that’s in the media business, who understands how to make more money out of the media business, who certainly understands our product, our intellectual property, what we do with it, what can be done with it, media rights Media both domestically and internationally. We see the international growth opportunity as massive. So in terms of choosing the right partner, those are all the things that we’ll look at, in terms of who can accelerate our business and, again, what’s the best value for our shareholders.”
How well do you think Saudi Arabia fits that description, Cagesiders?
