XFL owner Vince McMahon said Tuesday in bankruptcy court that he will not attempt to buy back the league.
In a court filing, McMahon called accusations that he was secretly maneuvering to use Chapter 11 as an avenue to cheaply retain the XFL “inflammatory” and “unsubstantiated.”
The XFL filed for bankruptcy on April 13 in Delaware district court, three days after laying off nearly its entire staff, citing the unforeseen impact of the coronavirus pandemic.
McMahon then put the league up for sale, but the court’s committee of unsecured creditors claimed last week that McMahon had set up a “fire sale” bidding process that would rig the process in a way that would allow him to buy back the XFL without repaying its debts.
In a deposition footnoted in Tuesday’s filing, McMahon said he had reserved his legal right to be a bidder in the original bankruptcy claim. He said he did that because “I think I was trying to make up my mind.” The committee’s filing last week pushed him to decide against a bid, he said.
“I don’t know why that’s out there, making me out to be the bad guy, [that] I’m going to buy the XFL back for pennies on the dollar, basically,” McMahon said in the deposition. “That helped me move into the direction of, ‘I’m not going to be a bidder, not going to have anything to do with it.’ I do hope that someone will pay a lot of money for it, and I do hope that it will survive.”
In the filing, McMahon’s attorneys wrote that McMahon put in “at least” $200 million of his own money into the XFL.
“Accordingly, all that the committee has managed to do,” the attorneys wrote, “… is to chase away a potentially significant bidder for the debtor’s assets.”
The XFL has hired the Houlihan Lokey brokerage firm to handle the sale. Houlihan Lokey managing director William H. Hardie III said in a filing Tuesday that 20 potential purchasers have signed non-disclosure agreements to gain access to confidential company data. An additional six potential purchasers are in the process of signing similar agreements, according to the filing.
“Based on preliminary feedback,” Hardie wrote, “I believe there is a robust market for the Debtor’s assets, including a number of potentially interested private equity firms and other financial sponsors.”
According to the original schedule it established, letters of intent are due June 12. Final bids are due July 6, subject to approval by the bankruptcy court, in hopes of putting potential new owners in position to get the XFL back on the field in spring 2021 if desired.