There appear to be two possible equilibria for rival sports leagues: an agreement to have their champions compete and then eventually the leagues merge like baseball (the AL and NL for baseball) OR a fierce competition which leads to the more established league (NFL, NBA, NHL) offered a merger and essentially a buyout of the upstart rival league (USFL, ABA, WHL). Can two professional leagues co-exist separately from each other and have similar levels of skill?

Economically explain your answer.