AEW was recently valued at more than $2 billion, and while there is warranted skepticism over that figure, the analyst believes it could be higher.
Mike Ozanian, the Assistant Managing Editor of Forbes Media and co-host/Managing Editor of Forbes SportsMoney, recently did a study on AEW business as of late, and he valued the company at more than $2 billion.
It was noted by Dave Meltzer of The Wrestling Observer Newsletter that this figure sounds very high, and others are skeptical as well, but Ozanian might not be too far off. We noted before how WWE stock recently dropped due to concerns with UFC competitor PFL (Professional Fighters League) receiving a $100 million investment from SRJ Sports Investments, a company launched by Saudi Arabia’s Public Investment Fund. It was recently revealed that PFL was in talks to buy the Bellator MMA promotion, which was valued at as much as $500 million. Based on this figure, it could be assumed that AEW is worth double.
“For all those skeptical of the $1 billion number for AEW, if Bellator’s sale is talking about $500 million, there’s no way AEW as a franchise isn’t far more than twice as valuable,” Meltzer tweeted, referring to the long-rumored $1B number for AEW.
The @FightOracle account then responded, “Dave, $1 billion valuation for AEW isn’t even close. It’s a lot more. Valuations are more art than science. But Khans don’t need investment so the valuation doesn’t really matter. They’ll self fund aka boot scrap and won’t be diluted upon exit/liquidity event.”
Ozanian replied to that tweet and said his recent $2B valuation for AEW is “likely minimum.”
Meltzer addressed the $2B valuation today and wrote, “That figure sounds very high to me. If you figure revenues at 12.5 percent of WWE and WWE’s worth at $9 billion, you can get to a $1 billion valuation but there is more to valuation than just revenue. I think a lot of this is the belief that AEW is getting a huge increase in rights fees on its next deal which is where that worth comes from, but I don’t count on anything until the deal is finalized. I wouldn’t assume anything on that deal until it’s completed with the rapidly changing nature of the television industry today.”
AEW President, CEO, General Manager & Head of Creative Tony Khan, who said he is not interested in taking the company public at this time, recently spoke with The Hollywood Reporter‘s Georg Szalai and mentioned how he has received billion dollar offers for AEW. Khan was asked if he has set any target for when he wants AEW to turn profitable, or if he had anything else to say on the matter.
“I typically talk about how I reinvest a lot of money,” Khan responded. “I have reinvested a lot of the money we gross in this business. Last year, we grossed over $100 million. This year, we’ll gross far more than $100 million – we’ll see where it ends up. But last year was $100 million, this year is going to be a lot more with video game revenue [for AEW Fight Forever, released this summer], Wembley revenue and the addition and [weekly TNT show, launched in June on TNT,] Collision. So our grosses will be far higher this year, and I’ve reinvested much of the money we’ve grossed back into the business. I’m still working off the original investment into the business, but have not had to put in more. And then we are reinvesting money to grow it as an international business. We’ve launched the video game, expanded the TV calendar, expanded the pay-per-view calendar and the merchandising.”
Khan continued, “We have a valuation of, well people have approached me with billion-dollar offers. So the business has grown. I’m not turning over huge cash profits. But as we approach the new media rights renewal, that is really the key not only to weekly profitability and cash flow, but also another large multiplier on top of the business valuation.”
Stay tuned to WrestlingHeadlines.com for more.
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