NFL team owners approve private equity investment plan: League statement

NEW YORK – National Football League (NFL) owners have voted to allow private equity investment in a landmark move that could see billions of dollars in new funding pumped into the sport, the United States-based league confirmed.

At a meeting in Milwaukee on Aug 27, the owners of the 32 teams gave the green light to a plan that would allow a group of hand-picked private equity firms to purchase up to a 10 per cent stake in a team.

The vote represents a significant departure for the way NFL teams are funded. Historically, franchises have been run as family businesses or owned by wealthy individuals.

The move potentially puts billions of dollars of new cash on the table to help pay for new stadiums and other projects for the most popular sport in the US.

According to NFL documents setting out the parameters of the new funding deal, private equity firms must also retain their investment for a minimum of six years.

The NFL has approved three firms – Arctos Partners, Ares Management and Sixth Street – as well as a consortium consisting of Blackstone, Carlyle, CVC, Dynasty Equity and Ludis, as the companies allowed to invest.

The companies plan to invest a total of US$12 billion (S$15.6 billion) and can invest in up to six NFL teams each, a source familiar with the matter said.

NFL commissioner Roger Goodell said that the carefully crafted funding measure would barely be noticed by fans.

“From a fan’s standpoint, this won’t change a thing,” he added.

“This is 10 per cent of a team. All it is is a silent position that would give access to capital for the teams that wish to offer 10 per cent of their teams.”

The decision brings the NFL in line with other US professional sports leagues, as well as some of the world’s biggest football teams.

Major League Baseball, the National Basketball Association (NBA) and the National Hockey League allow up to 30 per cent of teams to be owned by investment firms.

Sixth Street has already invested in Spanish football giants Real Madrid’s new stadium and also owns a stake in the NBA’s San Antonio Spurs.

Late in 2023, Arctos invested in the Aston Martin Formula One team in exchange for a minority shareholding. It had also acquired a minority common equity stake in French football club Paris Saint-Germain.

Another of the approved NFL investors, Dynasty Equity, owns a stake in English football giants Liverpool.

Goodell emphasised that private equity firms investing in the NFL would have no say in how teams operated or how the league was run.

“They will not be in any kind of decision-making influence in any way,” he said.

US reports have also said the NFL will not allow sovereign wealth funds – such as Saudi Arabia’s Public Investment Fund worth around US$925 billion – to invest in its teams.

At the end of the day, Goodell believes that allowing private equity investment would positively benefit the league.

“It’s an access to capital that I think has been of interest to us for a long time. Other leagues are doing it. And we’re doing it with a cap of 10 per cent – so a much less significant position,” he explained.

“But I think it’s an appropriate thing to give the teams that liquidity to reinvest in the game and their teams. It’s a positive development for us.”

NFL teams are some of the most valuable sports franchises in the world, with the Dallas Cowboys worth an estimated US$10 billion, according to sports business news website Sportico.

The Washington Commanders were the most recent team to be sold, in a record-breaking US$6.05 billion deal.

The value of NFL teams reflects the league’s dominance of the US sporting landscape, where it remains by far the most-watched professional league in the country.

In 2021, the league signed an astonishing US$110 billion media rights deal spanning 11 years – almost double the value of its previous media deal.

According to Nielsen, 93 of the top 100 most-watched US television broadcasts in 2023 were NFL games. AFP, REUTERS