Trumped
Donald Trump buys into WWE’s Raw franchise? Don’t buy it for a second.
June 18, 2009
For M&A journalists, the lack of an 8-K suggested that something may be fishy with the latest deal involving the publicly held World Wrestling Entertainment. But the storyline, involving Donald Trump’s acquisition of the company’s “Monday Night Raw” franchise, was believable enough to send the WWE’s stock lower on the news.
According to a press release issued by the company, Donald Trump acquired the WWE’s “Monday Night Raw” franchise in an undisclosed deal. The sale, while it may have surprised some investors, was still within the realm of possibility. The WWE has experienced some weakness due to the consumer spending pullback, and its live event and television segment registered a 6% decline in the first quarter. The company has embarked on a cost reduction initiative that analysts estimate could trim its budget by as much as $20 million this year.
As for Donald Trump, the deal also would not have been too far off the reservation. In recent years, he has moved away from real estate into other ventures, largely in entertainment. He currently owns the Miss Universe Organization and is an executive producer for the Apprentice.
Skeptics, however, were right to be circumspect. As it turns out, the deal announcement was merely a "kayfabe," which is wrestling speak for a gimmick. It’s not unlike the 2007 stunt involving a staged limo explosion that purportedly took the life of WWE Chairman and star Vince McMahon. McMahon “survived,” but the initial news still sent WWE’s shares lower.
WWE’s Robert Zimmerman confirmed that the Trump deal was in fact part of a storyline.
For the Donald, this is not the first time he has played a role in a WWE gimmick. He took part in a “hair-vs.-hair” match in which he and McMahon each backed a wrestler, with the loser having to shave their head. Trump, that time, was spared.
Fake or not, though, some deal pros and lenders are likely eager to see if Trump’s coiffure can survive a pile driver or an inverted powerbomb.
Art courtesy of flickr.com user cameronparkins via creative commons license.
For more information on related topics, visit the following:
