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Source: UFC buys Pride for less than $70M

3/27/2007

NEW YORK -- The majority owners of Ultimate Fighting
Championship have agreed to buy their biggest mixed martial arts
rival, Pride Fighting Championships, in a deal that will establish
megafights among the outfits' titleholders and possibly attract
huge pay-per-view audiences.

"This is really going to change the face of MMA. Literally creating a sport that could be as big
around the world as soccer. I liken it somewhat to when the NFC and
AFC came together to create the NFL."
-- Lorenzo Fertitta, one of UFC's majority owners

Company executives declined to comment on the sales price, but a
person familiar with the negotiations told The Associated Press
that brothers Lorenzo and Frank Fertitta will purchase the
Japan-based Pride for less than $70 million. The person was not
authorized to speak to reporters and spoke on condition of
anonymity.

The deal was completed Tuesday and was announced during a news
conference in Tokyo, where Lorenzo Fertitta has been negotiating
with Nobuyuki Sakakibara, the majority owner and chief executive of
Dream Stage Entertainment Inc., Pride's owner.

"We have been talking to Pride for probably about 11 months,"
Lorenzo Fertitta said. "It's been a long, drawn-out process but we
finally were able to put the two brands together."

To buy the company, the brothers created a new entity called
Pride FC Worldwide Holdings LLC. The newly formed company will take
over Pride assets, including its trademarks, video library and
valuable roster of fighters, from Dream Stage. The Fertitta
brothers, who own Las Vegas-based Zuffa LLC, the parent company of
UFC, intend to keep the well-known Pride name and promote fights
under that brand.

The acquisition marks a new phase in the brothers' quest to
dominate the burgeoning world of mixed martial arts since they
bought the struggling UFC in 2001.

"This is really going to change the face of MMA," Lorenzo
Fertitta said. "Literally creating a sport that could be as big
around the world as soccer. I liken it somewhat to when the NFC and
AFC came together to create the NFL."

The deal allows the Fertitta brothers to broker the biggest MMA
fights possible in the near future, increasing their influence in
this sports entertainment business.

"We will be able to literally put on the fights that everyone
wants to see," Lorenzo Fertitta said. "It will allow us to put on
some of the biggest fights ever."

In the past, there has been at least one case in which Pride and
UFC couldn't hammer out a deal to put their top fighters in the
ring together. With Pride in their pocket, the Fertitta brothers
intend to ensure that never happens again.

The sale gives Pride more financial backing to expand the
business internationally after suffering a recent financial blow.

Major sponsor Fuji Television Network Inc. dropped Pride in June
after a tabloid linked Pride to the Japanese mob -- something
Sakakibara has denied vigorously. To help bolster Pride, the
company staged two PPV fights in Las Vegas. Neither was a financial
success. The fights gained exposure for Pride but lost money,
making the sale of Pride more likely.

"I think it certainly weakened their position," Lorenzo
Fertitta said. "One of our goals is to get back on a major
platform back here in Japan."

Lorenzo Fertitta said he'll be looking to expand Pride
internationally.

Buying Pride is the latest in a series of acquisitions that the
brothers have made in the last six months. Zuffa snapped up World
Extreme Cagefighting and World Fighting Alliance last year.

Similar to Pride, buying WFA gave UFC the rights to a popular
fighter named Quinton "Rampage" Jackson. Jackson will face UFC's
most popular fighter, Chuck Liddell, the current light heavyweight
champ in Las Vegas, on May 26 on PPV.

In the combat world, the Pride deal leaves a fragmented group of
upstarts and K-1, another Japanese company that promotes fighters
skilled in various forms of kick boxing.

Thanks to a surge in popularity, the brothers' investment in UFC
and MMA in general has begun to pay off.

Last year, UFC cracked $200 million in PPV revenue, putting it
on par with World Wrestling Entertainment Inc.

UFC stages fights in arenas across the country and airs a clutch
of successful television shows on Spike TV. It has also opened an
office in London, looking toward establishing itself
internationally.

The brothers also run Station Casinos Inc. in Las Vegas. Lorenzo
Fertitta is president and Frank Fertitta is chairman and chief
executive of Station Casinos, a public company that was recently
agreed to be purchased by a private equity investor group that includes key
members of the Fertitta family.