XFL for sale after filing for bankruptcy
The XFL is looking to potentially sell its brand after filing for Chapter 11 bankruptcy on April 13, just days after the league suspended operations and laid off nearly all its employees.
The rebooted league was World Wrestling Entertainment CEO and league founder Vince McMahon’s second attempt to give fans an alternative to the National Football League and bring high-level football during the NFL’s traditional off-season. He controlled 100 percent of the XFL’s Class A shares and 76.5 percent of its Class B shares.
The league is hoping to sell its name, trademarks and other intellectual property in a potential deal that would require a judge’s approval by July 15, XFL attorneys said at a Wednesday hearing in U.S. Bankruptcy Court in Delaware.
“Like so many businesses and Americans, the XFL wasn’t immune from the COVID-19 pandemic,” said XFL attorney Michael Lunn during the hearing, according to the Wall Street Journal.
According to the Wall Street Journal, the XFL plans to hire an investment bank to spearhead a potential sale, and it is unclear if league officials have set a sale price.
When the Alliance of American Football filed for Chapter 7 bankruptcy last year, it entailed complete and total liquidation of the business. With McMahon deciding to file for Chapter 11 bankruptcy, it keeps the door open for a possible return, although it is unlikely.
Former WWE commentator Jim Ross said on his podcast that he was shocked the XFL filed for bankruptcy.
“I can see suspending play, much like the NFL has and other leagues, MLB, so forth and the NBA playoffs,” Ross said. “All these things that are being suspended based on, ‘Are we going to be able to proceed at some point in time, sooner than later?’ And of course, we don’t know that.”
The COVID-19 pandemic, which essentially shut down the XFL, caused the league to lose “tens of millions in revenue” since it cancelled the remainder of regular-season games and playoff games.
The bankruptcy filing revealed that the XFL had around 1,200 creditors and both assets and liabilities worth between $10 million and $50 million. When you compare this to the original XFL, they had $139 million in losses split between the 5 percent owners, NBC and WWE.
The XFL paid its employees through April 12, plus accrued vacation time, according to ESPN. The league also plans to refund all advance ticket sales.