Ultimate Fighting Championship’s $4 billion sale to talent company WME-IMG has delivered a powerful financial and brand-building punch to UFC as well as the wider mixed-martial-arts sports category, industry observers said.
The deal, the most expensive purchase of a sports franchise in history, completes a journey begun in 2001 when Zuffa LLC, owned by brothers Frank and Lorenzo Fertitta as well as UFC president Dana White, purchased the then-struggling franchise from Semaphore Entertainment Group for $2 million. At the time, UFC was limited to pay-per-view distribution and was outlawed by many states that considered MMA fighting too violent, but the Fertittas and White slowly created a franchise that now is considered a legitimate pro sport alongside boxing and has strong appeal with millennials.
“Nobody involved in the UFC could have imagined that the franchise would be valued at $4 billion,” said Bas Rutten, UFC Hall of Fame fighter and co-host of AXS TV’s mixed-martial-arts series Inside MMA. “The sale will solidify the UFC, and more people will now be interested in the UFC because they heard about the deal and want to check it out.”
Currently, UFC is in the midst of a multiyear television deal with Fox Sports that expires in 2018. Live UFC events televised by Fox and FS1 have delivered knockout ratings for the networks — thus far in 2016, UFC on Fox fights have averaged a combat sports high of 2.6 million viewers, while Fight Night bouts on FS1 have averaged 1.1 million viewers.
“We’re happy that the hard work and value created by Lorenzo, Frank and Dana has been rewarded,” Fox Sports president and chief operating officer Eric Shanks said regarding UFC’s sale. “We have been thrilled to be a partner on the ride and are big believers in the sport and the stars that have been created. We’re looking forward to beginning the next chapter with [WME] and Dana.”
The deal was also celebrated by owners of other mixed-martial-arts franchises who believe the $4 billion UFC purchase price also builds more value for their franchises and the MMA sport itself.
“It just shows that this industry can be a very profitable one if done properly, and there are people that want to invest in MMA,” said Scott Coker, CEO of Bellator MMA, which is owned by Viacom and offers live MMA events on Spike TV. “To see a number like that is great because the credibility and respectability of MMA is finally coming to the forefront.”