Stamford-based WWE (NYSE:WWE) found itself in a state of corporate turmoil as Vince McMahon sought to aggressively regain leadership in order to position the company for a sale.
The 77-year-old McMahon, who was chairman and CEO of WWE for decades, abruptly resigned in July amid revelations of secret hush money payments to former female employees who accused him of sexual harassment. After his departure, his daughter Stephanie McMahon and Nick Khan served as co-CEOs while Stephanie”™s husband Paul Levesque, an ex-wrestler who headlined in WWE as Triple H, took on the chief content officer role.
While McMahon is no longer running the company from the C-Suite, he still maintained majority voting power through his ownership of WWE”™s Class-B stock. Yesterday afternoon, WWE announced that McMahon was using his majority voting power to elect himself as executive chairman and to bring in Michelle Wilson and George Barrios, former WWE co-presidents and board members, as directors. McMahon added he was forcing his way back to power in order to coordinate a sale of the company.
“WWE is entering a critical juncture in its history with the upcoming media rights negotiations coinciding with increased industry-wide demand for quality content and live events and with more companies seeking to own the intellectual property on their platforms,” said McMahon in a statement issued by the company. “The only way for WWE to fully capitalize on this opportunity is for me to return as executive chairman and support the management team in the negotiations for our media rights and to combine that with a review of strategic alternatives. My return will allow WWE, as well as any transaction counterparties, to engage in these processes knowing they will have the support of the controlling shareholder.”
McMahon”™s required the removal of three board members to accommodate the seating of McMahon, Wilson and Barrios. According to a filing with the U.S. Securities and Exchange Commission that was signed by McMahon and dated Jan. 5, board members JoEllen Lyons Dillon, Jeffrey R. Speed and Alan M. Wexler have been removed.
The Wall Street Journal, citing unnamed sources, reported that McMahon told the board he would block any media rights deals or sale by the company unless he was reinstated as executive chairman.
McMahon”™s announcement came after the close of the trading day on the New York Stock Exchange. Since the news of his actions broke, WWE stock skyrocketed by 10% in after-hours trading.
