Netflix Proved Ari Emanuel Correct
Don't Bet Against Ari Emanuel
Last year I recall telling investor friends that Endeavor (EDR) founder and CEO Ari Emanuel would provide Revenue and EBITDA lift to WWE (TKO) post acquisition when WWE negotiated its new TV deal. I am not sure why the Street did not believe Emanuel when he talked about the appetite that the large streaming platforms have for original content, particularly live event content. This has been the case for at least the past several years if not the past five years. Well, Netflix (NFLX) has agreed to pay TKO Group $5 billion for the right to stream WWE’s “Raw” product over 10 years ($500 million per year rights deal).
That’s the low-hanging fruit for Emanuel on WWE’s Revenue side. Next is to remove operational waste, particularly from back-office functions where there may be overlap with Endeavor corporate and with the UFC, TKO’s other major operating unit.
Further, should Silver Lake wish to acquire Endeavor, the purchase price just went up. Where WWE and UFC have economic sensitivity is on the live events side should the economy soften. That said, the UFC just sold out Toronto’s Scotiabank Arena on Saturday January 20th when it held its UFC 297 PPV.
Best of luck to Silver Lake acquiring Endeavor on the cheap. Don’t bet against Ari Emanuel.