An Abu Dhabi-owned entertainment promotion company has bought a 10
percent stake in the Ultimate Fighting Championship for an
undisclosed sum.
UFC co-owner Lorenzo Fertitta told The Associated Press that
the deal with Flash Entertainment, a subsidiary owned by the
emirate's government, was done to create increased value for UFC
and help the mixed martial arts league expand in the Middle East
and Asia.
Neither Fertitta nor Ossama Khoreibi, chairman of Flash,
would estimate UFC's worth or say what Flash paid for the newly
issued shares in Zuffa LLC, its parent company. Fertitta says terms
of the deal are confidential.
A Forbes story in May 2008 estimated the privately held
company was worth perhaps $1 billion. Fertitta said then that
several investors have offered more than that for the league.
Fertitta told the AP that those offers have come from many
private equity funds, as well as several media companies and hedge
funds.
"We made the decision early on that if we were to bring on a
partner, it wasn't for financial reasons," Fertitta said. "We
didn't need to raise any money, that wasn't the purpose. If we were
going to bring somebody it was going to be with someone that could
really be a true strategic partner and could help create an
increased value for the company long term."
Fertitta said he believes Flash — a promoter known for
bringing high-profile concerts and other events to the Middle East
— can accelerate UFC's growth there and in China, India and
other countries.
Flash's new shares mean Fertitta's 45 percent stake in Zuffa
dropped to 40.5 percent. His brother, Frank Fertitta III, owns the
same amount.
Dana White, president of UFC, saw his stake go from 10
percent to 9 percent after the deal.
Fertitta would not say what would be done with the money
Flash invested or whether it would stay in UFC. Station Casinos
Inc., where Frank Fertitta is chairman and CEO and Lorenzo Fertitta
is vice chairman, has a pending bankruptcy case in Nevada that is
separate from UFC.
Fertitta said day-to-day operations at UFC would not likely
change.
Khoreibi said in an e-mail that its role will be to support
UFC as it keeps growing.
"The sport has incredible potential and the commercial
opportunities were very obvious to us," Khoreibi said.
UFC makes money with pay-per-view and live fighting events,
as well as TV deals, merchandise, licensing and DVD sales.
Fertitta said a fight in the Middle East could come this
year, perhaps as early as April.
"We're building a global brand," Fertitta said. "It's never
been done before in the fight business."
