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MARKET SAVVY

A Pro Wrestling IPO? Hey, You Got a Problem With That?

May 21, 1999|From Reuters

Now that the World Wrestling Federation has seized a statehouse with Minnesota Gov. Jesse "The Body" Ventura, it is heading for Wall Street with an initial public offering.

Owner Vince McMahon plans to take the company public in a deal expected to put a value on WWF of at least $750 million, according to a report in Daily Variety. WWF is understood to have hired Bear Stearns as lead underwriter on the stock offering.

Bear Stearns declined to comment and a WWF official was not immediately available.

WWF, a unit of privately held Titan Sports Inc., competes against Time Warner Inc.'s WCW. The business includes magazines, the Internet site http://www.wwf.com, and licenses for a variety of toys and video games.

Pro wrestling combines soap opera-like plots that hook viewers every week, the slapstick of the Three Stooges, the pumped-up physiques of bodybuilding, and the sex appeal of such stars as former women's champion Sable, who recently posed in Playboy magazine.

This mix has managed to keep professional wrestling in the top viewership ratings in cable television, particularly among men and boys. The TV popularity builds up pay-per-view television events and helps sell out arenas.

Wrestling has evolved in the last 20 years away from straightforward narratives about battles between good guys and bad guys and "shaved head matches," where the loser gets his head shaved. Story lines now involve "casket matches," where the loser gets thrown into a coffin.

"It is probably a good time [for an IPO]. The popularity of WWF is at a peak," said Steven Tuen, an analyst at IPO Value Monitor. However, he noted that, historically at least, buying into a sports franchise has not been profitable.

But then again, wrestling is technically not a sport.

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A Hold on Viewers

The wildly popular World Wrestling Federation is headed for an initial public offering. The WWF held three of the top five cable programs in prime time last week ranked by total viewers, in millions:

*--*

Day/ Cable Viewers, Program time channel in millions 1 World Wrestling Federation Mon., 10 p.m. USA 9.58 2 World Wrestling Federation Mon., 9 p.m. USA 8.71 3 NBA Playoffs Friday TNT 4.53 4 World Wrestling Federation Sun., 7 p.m. USA 4.39 5 A Perfect Murder Tues., 8 p.m. HBO 4.20

*--*

Source: Nielsen Media Research

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