NFL to decide on allowing private equity ownership

The National Football League is expected to vote today to allow private equity (PE) ownership of teams, making the NFL the last of the major American sports leagues to do so.

The league would allow PE to own up to 10% of a team, whereas the NHL, MLB, and NBA allow private equity up to 30%.

The NFL’s decision comes when teams have become extremely expensive, making it increasingly difficult to find more wealthy individual buyers.

A vote could help the league with liquidity problems. It has long had strict rules about who can buy a team, mostly allowing only multi-billionaires to join their exclusive club.

Last year, the Washington Commanders sold for $6.05 billion. Billionaire owner Josh Harris had to partner with 15 other investors to buy the team.

If the new rules pass, it will make deals easier to fund as just a few private equity firms, like Blackstone, CVC Capital Partners, and Carlyle Group, and some sports-focus firms, like Arctos Partners and Dynasty Equity, would be able to invest in teams. In return, these PEs are looking for a hefty payout in the future.

According to Sportico, the value of the NFL has risen from $23.46 billion to $190 billion in the past 20 years.

Several teams, including the Buffalo Bills and Tennessee Titans, are also focusing on building their own stadiums. The PE companies could provide the much-needed cash flow for such ventures.

The Cleveland Browns, Chicago Bears, and Washington Commanders are also planning properties.

Several experts say the NFL is most likely to approve PE ownership.

In other NFL news
The league has decided not to use its new electronic system to measure first downs during the 2024 regular season. It won’t be implemented until 2025. Instead, the traditional sticks-and-chain method will continue to be used this season.