The whirlpool continues to spin around the XFL, but it may not be in the drain just yet. Many people are still trying to wrap their heads around everything that has happened over the past few days for the league.
Thursday SI released a podcast with former Cowboys TE (and at the time exec for the Dallas Renegades) Daryl Johnston, where he talked about the planning for 2021. But by noon Friday, that was all undone by one phone call.
Every employee was let go, unceremoniously. And as soon as the call was over, the access to club and league files and services were gone. Immediately locked out. Last paychecks were delivered, and no severance packages.
Then, on Monday, we find out that the league had filed for Chapter 11 bankruptcy. Some held onto hope, as companies have done this in the past, just to try and restructure debt, but this would not be the case for Vince and his football league. He wrote a clause in the filing that excludes him from being part of the league, effectively placing the XFL for sale. And if it does not sell as a whole, they will move on to Chapter 7.
But hold on. Forbes and the Wall Street Journal released reports that say there is a heavy interest in the league. Former NFL player Andrew Kline-now an investment banker- had this to say in an email with Forbes:
“There are many folks interested and calling us, but we are not working on anything, and without a billionaire stepping in for Vince, we are not interested. If Vince McMahon was 100% committed to the XFL, I think it could have survived COVID-19 and much worse.”
Kline goes on to say that he spoke to many NFL coaches, and with players requesting less practice time, especially during the preseason, it would be harder to developed young players. And he hinted that a marriage with the NFL could help the XFL continue.
While this iteration of the league was doing well for itself in the first year, after having to stop in Week 5, never to take the field again, several things took place.
The first thing to realize, is that the XFL never had a TV deal. There was an agreement to share the broadcasting rights with the networks that air NFL games. While money was made during that time, those revenues went to the networks, and some to the NFL. Which was part of the deal struck with Fox by the WWE.
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The last half of the season, playoffs, and championship games were supposed to be a tryout, of sorts, for future broadcasting. Since they didn’t happen, there was no plan in place for 2021.
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Second, it’s highly unlikely that discretionary spending will be very high, considering the economic climate as it sits. The XFL reported losing as much as $27 million in sales for the regular season games they had to leave out.
And third, McMahon has lost at least 1$ billion during this past year. He had committed $500,000 to fund the league through the first few years, but only actually ponied up $100 million. After that, the speculation is that with everything put together, Vince was finished with football.
The WSJ reports that in the court hearing, McMahon laid out a plan that would give a $3.5 million loan, with a $750,000 immediate withdrawal, to pay back ticket holders. The court declined to allow that to happen, citing all debt is important to a company that’s for sale after bankruptcy. Milestones were set for this loan to come through. Mainly, that the sale must happen before July 15th.
With interest being there for the league, we may not have seen the last of the XFL. But one thing is for certain: Vince McMahon is out.
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