Endeavor has acquired WWE and will combine it with UFC to form a combat sports powerhouse. Even though the two promotions will continue to operate separately, the fact that they are now under one roof means that some positions within the company are currently filled by multiple people. When that happens, layoffs can be expected and Endeavor’s Mark Shapiro says this company will be no exception.
The Endeavor COO did not give a target number for cost reduction. He told Puck’s Dylan Byers that when Endeavor acquired UFC, it shed $70 million in costs and expects to surpass that this time around.
“Anything from H.R. to finance to legal to communications production to distribution and marketing,” Shapiro said. “Across every area, you’re going to find cost synergies; you’re going to integrate and ultimately highlight and appoint the best and brightest teams.”
Wall Street has had a very interesting response to the acquisition. WWE’s stock price is up 10% while Endeavor’s has fallen. Byers notes that is largely about the amount of debt Endeavor is taking on.
Byers writes that means other Endeavor properties could be on the chopping block. He suggests that the company may look to unload a business like the IMG Academy in Florida, a high school designed to spotlight elite athletic prospects.
There is also optimism regarding what Endeavor can generate by leveraging newly acquired WWE IP. The success of Wrestlemania 39 should be a sign that the live events business Endeavor has just acquired is very healthy.
