Market says VINCE MCMAHON is worth $500M less than ENDEAVOR

WWE was sold to UFC parent company Endeavor Corp. At $9.3 billion, that’s about 30 percent more than the company’s most competitive market cap. No one does this better than Vince McMahon, whose stake in the company has more than $3 billion in competitive fees, enough to place him on the Forbes 400 richest people list.

The problem is Wall Street disagrees.
McMahon owns 28.75 million shares of WWE, most of which fall into the super-voting category and will be converted into stock after the deal closes. As a result, WWE’s executive owner, McMahon, will own approximately 19 percent of the as-yet-unnamed combined UFC and WWE. Endeavor will own 51% of the company.
In its presentation to investors Monday, Endeavor said the deal is worth $105 to WWE.
98 each At this price, the 77-year-old McMahon should be worth $3,047 billion. Often, when a bid is announced at a premium, the share price jumps to the deal price—or more if investors are waiting for a better deal to come

Trouble is, WWE shareholders sold the company after this news, and WWE lost 9% on Monday, closing 2% at $89.30, 16% below market value. That means McMahon’s stake in WWE is valued at $2.57 billion – $477 million less than Endeavour’s claimed valuation. Regarding our

List, this ranking won’t be enough to place Vince in the Forbes 400, a long-term measure of American business success.
In fact, with the sale of the deal, McMahon’s fortune is $110 million less than in January when investors’ search for alternatives peaked.

Why is there a shortage? LightShed analyst Brandon Ross tweeted on Monday: “Investors disagree with the prices shared by banks in the deal. Tell the truth.”

There are many reasons for this.
The first is that investors will want to get a good return on all the cash. Most business people dislike having a job they don’t want to have (for example, this is why profits are often low).

Another reason may be that WWE’s 16% pre-release fee for new advertising is lower than the traditional 28% or higher fees.

A third factor may be that WWE owners find themselves under Endeavour’s scheme to run the UFC. WWE’s long-term debt is as low as $20.
9 million plus cash and equity, WWE has no debt. Meanwhile, the UFC, along with the MMA League, carried a dowry of $2.74 billion in long-term debt transferred to a new company, according to investor statements.

So far, McMahon’s surprise comeback after a six-month hiatus to bring WWE to market has paid off: WWE shares rose nearly $8 last November in the absence of former McMahon. However, this price is likely to decrease in the months to come for the establishment of the new company.

LightShed’s Ross said in another tweet: “The headline numbers about the ‘value’ of the UFC and WWE deals are irrelevant … the market will determine the value of the new company.”