Pacquiao Agrees to Cotto Fight - Bob Arum Wins in Advance!

Bob Arum of Top Rank Promotions has pulled off the coup of the decade after wrapping up the paperwork for a fight between two of his most prized boxers – pound for pound sensation Manny Pacquiao and highly-rated welterweight titlist Miguel Cotto.

The stablemates (who are both promoted by Arum) have agreed to face each other on November 14 at the MGM Grand in Las Vegas at a catchweight of 145 pounds. In so doing, Top Rank has put together a fight whose gate receipts will border the ten million dollar mark, and which will hope to sell well north of half a million pay-per-views. Since the bout is only for one title and involves only one promotions company, Arum has just scored a major victory in securing what is almost certain to be the biggest PPV event of the fall.

The reason I will focus on economics in this particular piece (rest assured there will be numerous follow-ups of the boxing variety) is the scenario I will put forth for your reading pleasure:

Let’s say that gate receipts total 9 million dollars (as most sell-out fights at the MGM Grand do). And that, as per Bob Arum’s estimate, PPV numbers match the Hatton-Pacman fight at circa 900’000. The calculation is thus:

(54.99 * 900’000) + 9’000’000 = $ 58’491’000

For those of us who aren’t all that great with numbers, that borders sixty million dollars, of which Arum, being the sole promoter here, keeps somewhere between a quarter to a third. Let’s call it a decent 30%. That means roughly seventeen million, all for Top Rank Promotions!

Arum has yet to announce the exact purse split, but I’m willing to bet that it’s in the ballpark of 60:40 in favor of Pacman. That means that Pacquiao, whose career earnings are close to $50 million, will make close to 25 million, regardless of the result.

Notably, the fight will be for the WBO welterweight title, which means that 3% of the purse goes to the World Boxing Organization as a sanctioning fee. This, however, still leaves Cotto with about 15 million dollars – by far the biggest payday of his career!

A number of boxing enthusiasts and journalists will blast Pacman for turning his back on “Sugar” Shane Mosley and his offer to split the purse 60:40 and fight at 140 lbs. Not I – if only for the reason that both Pacman and Arum would have been worse off, from an economic standpoint, as well as a boxing one.

First and foremost, Mosley is not as great a draw as Cotto. The latter has a huge following in New York and is idolized by Puerto Ricans all over the world. “Sugar” is popular in L.A. but was never a major PPV attraction. Pacquiao – Mosley would not have sold more than three quarters of a million pay-per-views, and as such would only have yielded about fifty million dollars, of which Bob Arum would have kept 30% of 60% (the rest would have gone to Mosley and Golden Boy Promotions, who handles the fighter’s business). By the same calculation as above, Arum would have made ten million dollars – forty percent less than by throwing Cotto into the mix.

Additionally, Pacman’s belt would have been at risk, as would his pound-for-pound status against a highly dangerous and seemingly-ageless Mosley (who, admittedly, lost to Cotto but beat Margarito after the Tijuana Tornado had pummeled the Puerto-Rican star into submission).

Of all permutations, Arum could not have come out looking any better. Whether the same can be said for both of his fighters, we will not know until after November 14.