Yesterday, as I was reading through all the reports on the Strikeforce-ProElite deal, I, admittedly, was little bit confused about what had actually happened. Was Strikeforce and ProElite still two separate entities? Or was ProElite now a part of Strikeforce?
For the most part, I eventually figured it out. Strikeforce had essentially purchased some, but not all, of ProElite’s assets, meaning they were still separate companies under different ownership and operated by the same people as before. For comparison’s sake, this is unlike the Zuffa-PRIDE deal where Zuffa took complete control of PRIDE, and eventually shut it down.
At this point, I think most people probably understand this, but if you’re still a little confused about the deal, Josh Gross has a in-depth interview with ProElite CEO Chuck Champion, who does a pretty good job of breaking down all the components of the deal.
There were the fighters. The libraries. There was the sub-licensing of ShoXC, which was the smaller event, so that both of us can use ShoXC footage, and [the] ShoXC title. All the specificity of that will be out there. But again, to be very clear, this is not a sale of the assets of ProElite just like what we saw with the IFL or closing down of ProElite or any of these kinds of things. That is not what occurred here. There were two separate transactions — one with CBS and one with Strikeforce — that basically now has resolved. You may recall we had litigation against the company by Wallid Ismael. That litigation has been settled, so the company is now without litigation. We’re in the process of paying off all the unsecured creditors, and the secured creditor being CBS is retiring its note.
The company will be debt free. We’ll have cash in the bank and a profitable entity in King of the Cage moving forward. I’ll now be turning my attention to issues following the Oct. 4 fight, and there are several I can’t talk about specifically. I’ll be dealing with Cage Rage, and I’ll be dealing with Icon, with Rumble World, and Spirit MC to determine how those assets will fit with us on a go-forward basis.
Basically, ProElite made a deal with Strikeforce, who acquired “select” assets of the company, and a separate deal, not involving Strikeforce, with CBS paying off the debt they owed them. Strikeforce also reached a deal with Showtime and CBS, but if I understand this correctly, that was a separate deal not involving ProElite.
Also, ProElite still owns the EliteXC brand. Whether they ever do anything with it is another question entirely, but from the looks it they probably won’t. According to Champion, their plan is to move forward with King of the Cage, so it doesn’t sound like ProElite will die off as expected.
Hopefully, that helps clarify the situation. The end result is basically a beefed up Strikeforce with pieces in place to compete on the national level and a stripped down, but debt free, version of ProElite with plans to move forward with the smaller promotions they previously purchased.