A handful of private equity groups are meeting with the NFL this week, according to multiple people familiar with the process, the latest step in the league’s deliberate march towards opening its ownership ranks to institutional money.
The league has different meetings set with individual firms or groups working together, said the people, who were granted anonymity because the details are private. One of the meetings is with Arctos Partners and another is with a consortium that includes Carlyle, Blackstone, CVC and Dynasty Equity, the people said. Other groups that have been involved in earlier conversations include Ares, Apollo and Sixth Street.
The meetings are intended for the league to conduct more due diligence, but also to talk through potential policy preferences. One of the topics for discussion, the people said, is the possibility of a call option that would allow the NFL to buy back stakes purchased by institutional funds should owners decide to reverse the policy. The league is also considering different options for size of investment—likely in the 5-10% range—and whether to demand that groups raise new NFL-specific funds.
Representatives for the NFL, Carlyle, Blackstone, CVC, Dynasty, Sixth Street and PJT, which was hired by the league to assist with the process, declined immediate comment. Representatives for Arctos, Ares and Apollo didn’t immediately respond to requests for comment.
The NFL, the only major U.S. league that doesn’t allow institutional investors, has spent more than a year observing results from other leagues and discussing what it might do differently. Most insiders expect the world’s richest league to be significantly more conservative than its peers, which would track with its tighter ownership rules in areas like governance and team sales. While other leagues moved quickly to on-board new investors, the NFL has deliberately discussed how to approach the topic more carefully.
The average NFL team is worth $5.93 billion, according to Sportico valuations published on Tuesday. As that number continues to grow, the number of people with the money (and interest) to buy minority stakes keeps shrinking. Control sales of the Denver Broncos and Washington Commanders raised questions about whether the league was "too big to sell," and there are currently a number of large minority stakes on the market that are yet to trade.
The NBA, MLB, MLS and NWSL all allow funds to hold up to 30% of a team’s equity. The NFL has been discussing the 10% range, with some owners pushing for something closer to 5%, sources said. The other major leagues also have not required that funds raise separate capital for their franchise investments, nor have they done full due diligence on all of a fund’s limited partners. The NFL could require both.
While specifics are yet to be decided, many around the league consider it a foregone conclusion that owners will vote to allow some sort of institutional option. A handful of teams already have term sheets ready to execute should the rules allow, sources said, with others in the market right now discussing potential stakes with both individual and institutional backers.
Commissioner Roger Goodell told owners to be prepared for a potential meeting Aug. 27 should a private equity vote be required. The fund meetings this week will help dictate whether that timeline is possible, or whether a formal change happens at a later date.
Expanding the pool of potential buyers for minority stakes would likely increase valuations across the league, a fact not lost on many owners. In response to these trends, the NFL last year formed a committee to explore possible changes. The group includes Kansas City Chiefs owner Clark Hunt, who is chairman of the NFL’s finance committee, plus Cleveland Browns owner Jimmy Haslam, Atlanta Falcons owner Arthur Blank, New England Patriots owner Robert Kraft and Denver Broncos owner Greg Penner.
