TKO Group Holdings announced its plan to launch a new boxing league after going through partnership negotiations with Saudi Arabia, which would be funding the launch since no financial investment will be involved with TKO. The latter will only participate in operational control and profit-sharing.
This article will dive into TKO’s business strategy and how the addition of a new boxing league will affect the global boxing dynamics.
Details of the Proposed Boxing League
The business group and the parent company of the WWE and UFC, TKO Group Holdings, is close to announcing a deal to introduce a new boxing competition in 2025.
It will be funded by Saudi Arabia as investors have shown keen interest to form the league after investing substantially to regularly host different heavyweight matches, including Oleksandr Usyk, Anthony Joshua, and Tyson Fury in the kingdom.
TKO Group Holdings COO, Mark Shapiro, discussed with investors on the earnings call on Wednesday during a question and answer, “Everybody knows we’re in talks with the Saudis, but to give you a little more color, I will tell you that we are close on an agreement with the Saudis on the creation of a boxing league where we, TKO, would be the producer, the promoter and responsible for all day-to-day operations of the venture, whereby we would receive a fee of $10 million-plus,”
Shapiro also stressed on the fact that TKO is not willing to put any capital into this project and hence, will not absorb any additional financial risk. The entire load will fall on the Saudi Arabia Public Investment fund, although Shapiro did mention that TKO will earn equity in the venture over a period of five years based on certain benchmarks.
UFC CEO, Dana White, and WWE president Nick Khan’s TKO leadership might provide valuable insight in growth for boxing once the new league is launched.
According to Shapiro, while boxing might become TKO’s new business, he promises that the organization will never lose sight of the primary ambition that drives revenue, UFC, and WWE.
Shapiro addressed the comments that company CEO and executive chairman, Ari Emanuel made about the changes in the Ali Act, which involved the federal law enacting in 2000 and providing additional protection to the boxers. During that time, Emanuel mentioned that the act can potentially hurt the sport and might affect its future. Although Emanuel’s opinion raised several eyebrows, Shapiro still promised that TKO will never get involved in legislation.
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Strategic Implications and Industry Impact
Last year witnessed TKO’s striking deals to buy three of its parent company’s premier businesses – agency behemoth IMG, travel and hospitality company On Location, and Professional Bull Riders (PBR) – for US$3.25 billion.
The trio would bolster TKO’s reach in various segments of the sports ecosystem, from live events and media rights to hospitality offerings and ticket sales, across several of the industry’s largest properties.
The transactions also demonstrate TKO’s aspiration to be a multidimensional company whose horizons extend beyond the UFC and WWE. The acquisition of PBR does add another sports property to its portfolio, but IMG and On Location significantly push the company’s operations and sphere of influence way beyond operating its own leagues.
TKO is also in negotiations for a new US media rights contract for the UFC. The MMA promotion’s existing deal with ESPN runs through the end of 2025, and it is said to want the next deal to earn over US$1 billion annually.
Aside from plans for a boxing league, Shapiro also hinted at plans for a couple of mega-cards most likely to occur in 2025 and 2026 as part of the agreement.
“I think I’ve given you at least a framework of what the deal would be,” Shapiro said.
“It’s its own league and we’d have consistent fights throughout the year. I think on top of that you should know as part of the partnership, we would be the promoter, producer and event operator for four large-scale kind of superfights, as I call them, that would air, probably two this year and two in 2026.”
