San Francisco 49ers’ No. 13 Brock Purdy prepares during the first quarter against the Kansas City Chiefs during Super Bowl 58 at Allegiant Stadium in Las Vegas on February 11, 2024 Team.
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The National Football League has notified owners and investment firms that it intends to take a percentage of private equity profits from future sales of ownership stakes, people familiar with the matter said.
NFL owners voted Tuesday to allow private equity firms to own up to 10% of their teams.
The league has never allowed private equity investment before. Major League Baseball, the National Basketball Association and the National Hockey League have allowed up to 30% of teams to participate owned by investment companybut the upper limit for individual funds is between 15% and 20%.
No other alliance charges all private equity firms a percentage of the so-called spread (the percentage of a fund’s investment profits that fund managers typically receive as compensation). It’s unclear whether the NFL’s plan applies to all companies or just some, or what percentage of profits the league hopes to capture.
The NFL has informally told investment firms that if they get a return on their investment, it wants to give some of the profits back to the league.
It’s unclear whether the NFL’s plan to capture some of its profits will deter future investments by private equity firms. Initial approved companies include Ares ManagementSixth Street Partners and Arctos Partners, as well as an investor syndicate consisting of Dynasty Equity, Blackstone, Carlyle Group, CVC Capital Partners and Ludis, a platform founded by investor and former NFL running back Curtis Martin.
The NFL declined to comment.
According to Sportico, the total value of the league has increased by 710% from US$23.46 billion to US$190 billion in the past 20 years. The S&P 500 Index rose approximately 660% during the same period.
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