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Dwayne 'The Rock' Johnson buys XFL in $15 million deal

Yahoo Finance's Dan Roberts joins the On the Move panel to discuss Dwayne Johnson and his business partner acquiring the XFL in deal worth $15 million.

Video Transcript

JULIE HYMAN: I want to turn to something else real quick, Dan, because we have a bit of extra time. And it has to do with the XFL, which has some new owners, including Dwayne "The Rock" Johnson. I'm sure you're following that story. And so tell us about that and your take on it.

DAN ROBERTS: Yeah, It's interesting. It's a headline that has made a splash. Wow, The Rock buys the XFL. And let's mention that he is leading this group along with RedBird partners and along with Dany Garcia. And she is actually his ex-wife and his business partner, very interesting, unique situation. And I think people should note, you know, it's the two of them leading this group.

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Now, does that mean the XFL automatically will come roaring back, be back on TV, be successful? Not necessarily, not guaranteed. There are people who will say that the reason it filed for bankruptcy was purely the pandemic and that it got so unlucky. And if it hadn't been for the pandemic, the return of the XFL would have been a success.

Then there are people who say it wasn't just a pandemic. Maybe the XFL wasn't needed again after all. And I'm more in that camp for now. I'm a little skeptical that it's going to come roaring back. But you know what? If there's enough of an appetite for pro football in America, enough that the NFL can exist and so can another pro football league, then great.

But it is a tough time to come back after the pandemic. Then again, people are starved for live sports, so we'll see what happens. Obviously, the goal here is for him using his clout to cut deals with a major broadcast network to get another season, another chance for the XFL.

DAN HOWLEY: Dan, I was a early adopter of the new XFL or the previous new XFL, Tampa Bay Vipers fan for no apparent reason, really. But, you know, it seemed like it had good traction out of the gate. And then it just kind of fell off, there was nothing, you know, driving interest week to week. How do they solve for that problem?

DAN ROBERTS: Yeah, the ratings for the debut were very good. And then there was a steep drop off. And let's mention, and this is a good example of my skepticism, the ratings for the debut of the AAF were also great. Do you guys remember that? That was only a year ago. The Alliance of American Football. And then that went under, did not complete its first season.

So, you know, you can't just look at the first week when a new league starts up because it's kind of like a restaurant. You know, a lot of restaurants in their first year do well because it's new, and people are trying it out. But then what happens in the second year? So I do think, Howley, that it's going to be tough.

It's all about how they finish. And the key metric to look for as the XFL returns again, how many primetime games can they get a commitment for? So, you know, we've had Paul Rabil on a number of times. He launched the Premier Lacrosse League. And in its second year, it got NBC Sports to commit to more total live games airing on main NBC. That was very big.

So if the XFL wants to come back and be successful, it has to get a broadcast partner to say, we will air this many of your games in primetime. And that's tough, when it's unproven.

JARED BLIKRE: Hey, Dan, let me ask you about where does this lead potentially? Does this open up the door to more acquisitions, more integration in other sports? What's the big picture here?

DAN ROBERTS: Well, one interesting thing financially, Jared, you know that the last two weeks, we've all been talking about SPACs. Or some people prefer SPAC, those special purpose acquisition companies. That's how Draft Kings went public. You sell two or merge with an already public company that only went public in order to buy or merge with a startup.

So that is the case here. By the way, I should mention Dwayne "The Rock" Johnson, this involves an SPAC. And also, we know that, I believe, Ackman just formed a big SPAC, that he has stated-- intends to buy off some kind of sports property. So what happens next? Well, I'm not going to go ahead and say that a number of new leads are going to launch, especially because, right now, the big leagues themselves are struggling, right?

I mean, is MLB going to complete its return. NBA, looking good. MLS, looking good. But MLS, by the way, losing a lot of revenue by playing without fans because they're so reliant on gate receipts. So all that is a long way of saying, boy, do these guys buying up the bones of the XFL spell success for other new leagues?

I don't necessarily think so. I think it'll take a couple years just for the existing big leagues to be back on their feet again completely, then we can talk about new leagues.