CAPE TOWN – The Extreme Fighting Championship aims to erase its financial strain and increase business growth following a change in its structure.
Africa’s premier mixed martial arts organisation recently opened up its business to the public in a move that will see 20% in equity being offered to fans, contracted EFC fighters and investors.
The listing has been made available on direct investment marketplace Stack Assets, which is owned by Stack Advisory (Pty) Ltd.
The listing comes in an attempt to not only assist with running costs that come with putting on high-level mixed martial arts productions, but also to help build the brand, the sport and athletes in Africa.
“The potential and value that the capital raise will bring to the growth of the business is vast,” says EFC president Cairo Howarth.
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“We have been a privately owned company since inception, and not only are we very optimistic about the new heights and milestones that this listing will allow us to achieve, but we are also really excited about the benefits of having our athletes and supporters as shareholders in the busines.”
The limited equity will be made available in four stages starting from R1 000 per share with 5 000 shares being released in each stage. As per the EFC, the new EFC listing allows investors to own equity at a $7million valuation and it is estimated that the share price will increase by 20% at every stage entry.
The world’s largest MMA promotion, the Ultimate Fighting Championship - who (through its owners, Endeavor Group Holdings Inc) launched an initial public offering with its stock last week - is valued at over $7billion. The UFC’s parent company, raised $511m during its initial public offering with its stock up 5% from the opening price.
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With regards to the EFC, the capital raised will be used to continue with its African expansion plan that has so far seen the EFC reach more than 200 million people across Africa per year and has content now available in over 130 million homes worldwide.
The brand has been known to put on the best combat sport productions, setting a global standard, however, after running into some financial troubles three years back, the brand has had to cut back on nationwide events, at times also copping criticism due to fighters, workers and suppliers not being paid.
With that said, Howarth confirmed that this new venture will assist vastly in getting the brand to where it belongs and beyond.
“We need capital to get going again,” says Howarth.
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“We do have accounts with suppliers, we do owe money to suppliers ... That is what part of this is for, we need to get operating again and generate revenue. EFC does take money to operate. We could do our show a lot cheaper and change our profile, but we don't want to do that,” he continues.
“We believe now is the time to put on the best show we can and really go out to the world with the best product, but it takes money and this is what this investment is about, paying athletes, getting the best athletes on the card, putting the best production together and delivering a world-class product to TV stations and fans around the world,” said Howarth ahead of this weekend’s EFC85 event which will see fighters competing for joint-equity and purse money.
In terms of reaching a new market and investment, there has not been a better time for investment since Covid-19 and the subsequent lockdown saw millions of eyes turning to MMA due to the lack of other sport available on TV.
With the UFC being one of the only brands to bring live shows to the world amid the lockdown, along with EFC’s old content being played on SuperSport, it has seen a ripple effect on MMA awareness reaching new markets.
That, coupled with the fact that the UFC has three African-born champions (Francis Ngannou, Israel Adesanya and Kamaru Usman), bodes well for mixed martial arts and the growth of the sport in Africa.
“With this share offering, EFC is once again pioneering a new path by revolutionising sport league ownership in Africa, and with the projected growth in value that MMA and live sport has, there is no better time to do it than now,” adds Howarth.
For more details on purchasing EFC shares, download the Stack Assets app or visit efcworldwide.com.
Viewers can catch the main card of EFC85 starting at 6pm on Saturday on SuperSport Action and Variety 3.
Checkout the full interview with Cairo Howarth on the MzansiMMA YouTube channel.
IOL Sport