Vince McMahon’s American football reboot the XFL has officially filed for bankruptcy, a week after the league suspended its operations following its season being cancelled.
The decision was revealed after the company entered Chapter 11 bankruptcy protection, in which the XFL will likely propose a plan of reorganisation to keep its business alive. However, given the fact that the firm failed to complete its season, saw gradual viewership decreases, and fired a vast majority of its staff, the league looks to be over whilst under the tenure of Alpha Entertainment.
An XFL spokesperson stated: “The XFL quickly captured the hearts and imaginations of millions of people who love football. Unfortunately, as a new enterprise, we were not insulated from the harsh economic impacts and uncertainties caused by the COVID-19 crisis. Accordingly, we have filed a voluntary petition for relief under Chapter 11 of the US Bankruptcy Code.
“This is a heartbreaking time for many, including our passionate fans, players and staff, and we are thankful to them, our television partners, and the many Americans who rallied to the XFL for the love of football.”
As part of the firm’s bankruptcy filing, the XFL has listed its assets and liabilities though its parent company Alpha Entertainment LLC, with the figure’s between $10m-$50m. Moreover, some of the firm’s creditors include XFL head coaches Bob Stoops ($1.08m) and Marc Trestman ($777,777), whilst owing broadcast services firm NEP an estimated $1.21m.
Ticket firms Elevate Sports Venture and Ticketmaster will also be expected to be paid $856,175 and $655,148 respectively for its services. Finally, the XFL has still to pay the New Meadowlands Stadium Company for its MetLife Stadium lease of $368,000.
The XFL’s bankruptcy has also affected Vince McMahon’s WWE after it was revealed that the professional wrestling firm owned 23.5 percent of the league’s Class B shares. Furthermore, McMahon separately owned 100 percent of Class A shares and 76.5 percent of Class B shares.
The bankruptcy will then not only hit WWE financially, as the firm liquidated it’s stocks in order to pay for the XFL but it has revealed that the firm was directly invested into the American Football brand, contradicting reports that the two entities would remain separate.
It is expected that the XFL will be offered to other companies in order to sell the firm during its bankruptcy period. However, the likelihood of a suitor especially during the current coronavirus outbreak will be difficult.
Insider Insight: Despite the XFL stating prior that it will resume in the 2021 season after canceling its inaugural campaign, the resumption looks unlikely unless another firm jumps in. Nevertheless from prior attempts with the NFL, twice, and the Alliance of American Football, an American Football spring campaign has proven to be a tricky market to invest in.
