Showtime Networks filed public notice with the U.S. Securities and Exchange Commission Thursday announcing its intention to enter preliminary negotiations for the purchase of Pro Elite Inc.
Showtime, a subsidiary of the parent conglomerate CBS Corporation, already enjoys broadcasting deals with the Los Angeles-based company on both its premium cable channel and CBS. Showtime also has a 20% ownership stake in Pro Elite.
The potential acquisition could not come at a more opportune time for the fledging company, as Pro Elite faces a $55 million deficit accrued during its two years of operation.
It looks like Pro Elite’s rapid buyout of a lot the smaller mixed martial arts promotions (Cage Rage, Icon, ROR, KOTC…..) has finally caught up with them.
According to SEC filings, Pro Elite needed to raise 3.3 Million to continue operations, but fell short only obtaining 1 Million from Showtime which must be paid back by June 18, 2009 to fend off Showtime from holding “First Priority” interest stake in the company.