One of the largest stories to monitor in 2018 will be the progression and roll out of Vince McMahon’s recently formed group, Alpha Entertainment LLC.
The story took shape last weekend when it was reported by journalist Brad Shepard that McMahon was putting plans in place to revive the XFL with a scheduled announcement for late January.
Shortly after this news was broken, the WWE provided a statement on the record to David Bixenspan of Deadspin:
Vince McMahon has established and is personally funding a separate entity from WWE, Alpha Entertainment, to explore investment opportunities across the sports and entertainment landscapes, including professional football. Mr. McMahon has nothing further to announce at this time.
The statement revealed for the first time, the existence of McMahon’s personal venture, while also distancing the WWE from the venture, likely as a sign to stockholders that it would not affect WWE business.
The idea of McMahon reviving the failed XFL brand could be traced back to the ESPN “30 for 30” documentary on the league’s one-year existence. The documentary culminated with McMahon and former chairman of NBC Sports Dick Ebersol discussing the legacy of the league. McMahon provided a coy response when asked by Ebersol about bringing the league back and doing it all over again.
That kernel of a hint took form over the past week, then an enormous leap on Thursday with McMahon selling 3,340,000 of his Class A shares of WWE stock to raise close to $100 million of startup capital for Alpha Entertainment. This coincided with a number of XFL related trademarks being filed for by Alpha Entertainment and an apparent strategy to acquire the WWE’s XFL related trademarks and be absorbed by McMahon’s new outside company.
The following statement was included in the filing with the Securities and Exchange Commission with the selling of McMahon’s Class A shares:
Mr. McMahon executed the sale primarily to fund a separate entity from the Company, Alpha Entertainment LLC, which Mr. McMahon established to explore investment opportunities across the sports and entertainment landscapes, including professional football. Mr. McMahon has informed the Company that he has no current plan to sell additional shares of the Company’s stock and that he intends to continue in his capacity as the Company’s Chairman and Chief Executive Officer for the foreseeable future.
The shares sold by Mr. McMahon represent approximately 4.3% of the Company’s total outstanding shares of Class A and Class B common stock. After the sale, Mr. McMahon beneficially owns 32,193,375 shares of the Company’s Class B common stock, which represents approximately 82.8% of the Company’s total voting power and approximately 41.8% of the Company’s total outstanding shares of common stock.
The original XFL venture was announced in early 2000 and launched in February 2001 and became a partnership between the WWE and NBC. The league launched with tremendous audience numbers during the initial week with a great marketing campaign that drove curiosity to what Vince McMahon’s alternative vision of football would entail. The games on NBC, UPN, and TNN would see rapid declines over the next several weeks with ridiculous stunts being relied upon to generate buzz on the league from putting cameras in the female cheerleader’s locker room to a contrived feud between commentator Jesse Ventura and New York / New Jersey Hitmen coach Rusty Tillman.
In April of 2001, the league announced it would be folding after one season and losses totaling nearly $138 million between the WWE and NBC.
The WWE stock closed at $31.87 on Thursday and with the news of McMahon’s stock sale, it led to a close at $29.55 on Friday.