TKO Group Holdings executive Mark Shapiro said the company is “on the sidelines” trying to figure out whether former Chairman Vince McMahon will sell any more of the massive stock he holds in the company.
Shapiro, who is TKO's president and COO and holds the same position at majority shareholder Endeavor Group Holdings, noted that McMahon still owns about 20 million shares of TKO stock, despite selling more than 8 million shares last November. The proceeds from the sale exceeded $700 million.
McMahon abruptly resigned as board chairman last month after a former employee filed an explicit lawsuit alleging prostitution and sexual assault. McMahon, who has built WWE into a profitable global business and cultural force for more than four decades, oversaw this year's TKO-generating $21.4 billion merger with the UFC.
“He’s going to do whatever he’s going to do and we’re all sitting on the sidelines,” Shapiro said when asked about the status of the company’s fourth-quarter earnings call. “Let me take a look. We have no idea about timing. We are not having any discussions with him. He gave no view on his motivations or whether he would sell, how he planned to sell, or how much he would sell for. So we’ll just wait and find out, like you do.”
The executive did not specifically address McMahon's legal troubles, but they came to light thanks to the stock sale mentioned by TKO CFO Andrew Schleimer during the call. Ari Emanuel, CEO of Endeavor and TKO, had no comment regarding McMahon.
Asked to clarify his forecast that the company plans to delay capital allocations until 2025, Schleimer said management expects to be in a “meaningful cash position” by the end of this year while keeping the powder dry. Nonetheless, that stated plan “does not eliminate” the possibility of investing some of the cash in the right situation. The executive acknowledged that one such scenario could potentially involve McMahon purchasing stock that he sold to fund his legal defense. Last fall, some of the stock transferred by McMahon was purchased by the company and its executives.
Before the graphic lawsuit was filed this year, McMahon admitted to paying millions of dollars in hush money to numerous women. The lawsuit, which is said to have prompted an investigation by federal authorities, is expected to carry significant legal liability. Some analysts have speculated that the former WWE impresario could continue to pay his legal fees by selling additional stock.
Last month, MacMahon called Janel Grant's lawsuit “filled with lies, salacious made-up examples that never happened, and a vindictive distortion of the truth.” He said, “I will strongly defend against groundless accusations.”