Early in 2010, Flash Entertainment, a wholly-owned subsidiary of the Government of the Emirate of Abu Dhabi, acquired a ten percent stake in ZUFFA, LLC, owners of the Ultimate Fighting Championship. The purchase price at the time was never publicly revealed but was believed to be up to $200 million. The UFC sold to the WME-IMG (now Endeavor) for $4 billion in 2016, and was estimated by UFC president Dana White to be worth much more today.
We just did a TV deal with ESPN for $1.5 billion for five years,” said White last month on Tony Robbins’ ‘Master Your Life; podcast. “Now the company is worth $7 billion.
In 2017 Endeavor secured an extra $1.1 billion in funding for the purpose of buying back any shares not acquired in the $4 billion buyout. Now Arabian Business reports that the UFC has bought the 10% stake back.
In an exclusive interview with Arabian Business, confirmed the sale of the global martial arts business shares, which it bought in 2010.
“After almost 10 years the time was right to exit that investment,” said Flash Entertainment CEO John Lickrish.
Flash, an entertainment promotion entity, has partnerships with FIFA Club World Cup, Ticketmaster, and the World Professional Jiu-Jitsu Championship. For a decade, Flash Entertainment helped build the UAE’s entertainment industry, putting on everything from Justin Timberlake to F1 concerts. However, Lickrish conceded that partnerships can be challenging.
“We’ve tried a few and it’s always give and take,” he explained. “There’s what’s on the piece of paper and then there’s the reality of making it work in practice. And the larger the organization, the more challenging it can be.
“It’s important for a company with regional aspirations to be able to work with multi-national companies. But obviously the bigger they are the harder it is to get away from their cookie-cutter approach to each market, especially this market. It’s always a challenge to get people to innovate and understand the region.”
The amount of the buyback was not announced. However, even at $200 million, the highest estimate of the original purchase, a low estimate of the buyback, $400 million based on the 2016 sale, would be a handsome annualized return on investment of 7.2 percent.
