Bankrupt IFL Still Hunting for Sale
Jason Probst Sep 19, 2008
The International Fight League is looking to sell its last tangible
assets -- primarily the rights to its video library of fight
footage -- to the highest bidder. In a downward spiral for last few
months, MMA’s latest promotional casualty filed for bankruptcy
Tuesday.
The IFL promoted 23 events during its two-year run, and had broadcast deals with MyNetworkTV, Fox Sports Network, and various international outlets. The promotion never launched into the pay-per-view market.
IFL President and CEO Jay Larkin stated Tuesday that the company is
currently looking for buyers, but that no deal had been finalized.
Larkin did add that an announcement should be coming “in the next
couple days” regarding a sale of the company’s remaining assets,
which presumably includes its video library and possibly any
remaining international television rights deals.
“The company is weighing the different options available to it in terms of what to do with the assets,” Larkin said. “We have no shows scheduled, and we have let the fighters go. They have scattered to many organizations.”
According to the company’s SEC filing on Aug. 27 for the second quarter of 2008, the New York-based organization was pared down to four employees and had $1 million left in cash with an accrued debt of nearly $36 million.
It’s a far cry from where the promotion, which prided itself on its unique team-based format, began.
After going public in November 2006 following five promising shows, IFL stock peaked at $17 per share in January 2007, then began plummeting, sliding below the $1 per-share mark in June 2007. As of this week its share price was .01.
During a July 19 event on Spike TV, the UFC utilized IFL footage for a few fighters appearing that night, which raised questions as to whether or not the IFL had sold its video rights to the UFC.
The IFL is seeking a buyer for the last
of its assets, including video rights.
“They have not (purchased these),” Larkin said. “We're cooperating
with several organizations that have asked us to help out” by
providing footage of fighters competing on cards such as UFC and
Affliction.
This summer, the IFL took a final nosedive when, during a June conference call, Larkin announced the company was canceling its Aug. 15 show.
Since that announcement, a former high-ranking IFL employee, who wishes to remain anonymous, said Larkin has had “extensive conversations” with Lorenzo Fertitta, co-owner of UFC parent company, Zuffa LLC.
“UFC is giving these guys 4 and 4 ($4,000 to show/$4,000 to win) and locking these guys into two-year contracts,” the former IFL employee said, questioning why several IFL fighters were released from contracts, then re-signed by the UFC, instead of being bought directly from the IFL, which is a public company.
That employee also added that several potential buyers had stepped forward to negotiate for the IFL’s assets at the time, which was said to have included the contracts for its star attractions.
Pro Elite confirmed to Sherdog.com that it had been one of the parties interested in purchasing the company.
Strikeforce promoter Scott Coker said he also made an offer for IFL assets, but it didn’t get any traction, as the Larkin informed Coker that the IFL was already in final-stage negotiations with another buyer.
“We had a conversation with Jay about looking into the acquisition of the IFL,” Coker said. “And then what happened was, by the time we got back to Jay he’d informed me he was already in the eleventh hour with another company. When we reached out to him, we said there would be some interest about assets of the IFL. That was in late July.”
When asked about the promotional value of the IFL’s video library, Coker called it “attractive” but added that its value might be more in a year or two as fighters on those cards get bigger in the sport in other organizations.
“We were thinking of it as an asset acquisition, basically the assets are the fighters and the library,” Coker added. “I think for us, the (question) is ‘Can we monetize the library?’ and I think we could have. Look at King of the Cage, and some of the fighters that have gone through there. Diego Sanchez. Matt Hughes. Anybody that’s become a star in the UFC or Pride, before they fought there, a lot of these guys started in smaller organizations.”
With numerous signs seemingly pointed toward some sort of UFC acquisition, Larkin, who joined the IFL in March in the hopes of turning it around, said he’s still not sure if MMA is much more than a one-horse town.
“You don't always know what you got till it's gone. There's a lot of lessons to be learned,” said Larkin, a longtime boxing programming executive with Showtime. “One of the things I tried to do was do it in a more professional manner. The bottom line is, I feel MMA is a one-organization industry. I think UFC has done a spectacular job of branding, and UFC has become synonymous with MMA. And there's a couple of hangers-on now. Wall Street’s having a hard time right now. I'd like to see MMA flourish but I'm very skeptical.”
The IFL promoted 23 events during its two-year run, and had broadcast deals with MyNetworkTV, Fox Sports Network, and various international outlets. The promotion never launched into the pay-per-view market.
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“The company is weighing the different options available to it in terms of what to do with the assets,” Larkin said. “We have no shows scheduled, and we have let the fighters go. They have scattered to many organizations.”
A handful of the IFL’s brightest stars have recently signed deals
with the UFC, WEC, EliteXC, and Affliction Entertainment, as the
company all but closed its doors over the summer.
According to the company’s SEC filing on Aug. 27 for the second quarter of 2008, the New York-based organization was pared down to four employees and had $1 million left in cash with an accrued debt of nearly $36 million.
It’s a far cry from where the promotion, which prided itself on its unique team-based format, began.
After going public in November 2006 following five promising shows, IFL stock peaked at $17 per share in January 2007, then began plummeting, sliding below the $1 per-share mark in June 2007. As of this week its share price was .01.
During a July 19 event on Spike TV, the UFC utilized IFL footage for a few fighters appearing that night, which raised questions as to whether or not the IFL had sold its video rights to the UFC.
Jeff
Sherwood/Sherdog.com
The IFL is seeking a buyer for the last
of its assets, including video rights.
This summer, the IFL took a final nosedive when, during a June conference call, Larkin announced the company was canceling its Aug. 15 show.
Since that announcement, a former high-ranking IFL employee, who wishes to remain anonymous, said Larkin has had “extensive conversations” with Lorenzo Fertitta, co-owner of UFC parent company, Zuffa LLC.
“UFC is giving these guys 4 and 4 ($4,000 to show/$4,000 to win) and locking these guys into two-year contracts,” the former IFL employee said, questioning why several IFL fighters were released from contracts, then re-signed by the UFC, instead of being bought directly from the IFL, which is a public company.
That employee also added that several potential buyers had stepped forward to negotiate for the IFL’s assets at the time, which was said to have included the contracts for its star attractions.
Pro Elite confirmed to Sherdog.com that it had been one of the parties interested in purchasing the company.
Strikeforce promoter Scott Coker said he also made an offer for IFL assets, but it didn’t get any traction, as the Larkin informed Coker that the IFL was already in final-stage negotiations with another buyer.
“We had a conversation with Jay about looking into the acquisition of the IFL,” Coker said. “And then what happened was, by the time we got back to Jay he’d informed me he was already in the eleventh hour with another company. When we reached out to him, we said there would be some interest about assets of the IFL. That was in late July.”
When asked about the promotional value of the IFL’s video library, Coker called it “attractive” but added that its value might be more in a year or two as fighters on those cards get bigger in the sport in other organizations.
“We were thinking of it as an asset acquisition, basically the assets are the fighters and the library,” Coker added. “I think for us, the (question) is ‘Can we monetize the library?’ and I think we could have. Look at King of the Cage, and some of the fighters that have gone through there. Diego Sanchez. Matt Hughes. Anybody that’s become a star in the UFC or Pride, before they fought there, a lot of these guys started in smaller organizations.”
With numerous signs seemingly pointed toward some sort of UFC acquisition, Larkin, who joined the IFL in March in the hopes of turning it around, said he’s still not sure if MMA is much more than a one-horse town.
“You don't always know what you got till it's gone. There's a lot of lessons to be learned,” said Larkin, a longtime boxing programming executive with Showtime. “One of the things I tried to do was do it in a more professional manner. The bottom line is, I feel MMA is a one-organization industry. I think UFC has done a spectacular job of branding, and UFC has become synonymous with MMA. And there's a couple of hangers-on now. Wall Street’s having a hard time right now. I'd like to see MMA flourish but I'm very skeptical.”
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