For the first time, institutional investors will be allowed to partially own NFL franchises.
NFL owners passed 2024 Resolution JC-7 on Tuesday, allowing private equity funds to purchase up to 10% of any franchise for passive ownership, meaning funds would not have voting or any real decision-making power with teams. According to a league source, the vote passed 31-1, with the Bengals the lone dissent.
Funds are capped at investing in a maximum of six teams, and the minimum investment for institutional wealth in any franchise is 3%. If a fund buys into a team, it must hold onto the investment for a minimum of six years. Funds must have a minimum of $2 billion of committed capital to invest and a maximum of 20% of a fund's money can be invested into one team.
Team owners or their immediate family members may invest up to 3% in a fund. Any ownership changes still need to be approved by a three-fourths majority of teams.
"They spent a lot of time, a lot of work and I'm appreciative of the kinds of interest that we have from the financial community that spent the time they did putting this together," Dallas Cowboys owner Jerry Jones said. "This is a win for the game."
The league provisionally approved eight funds as four potential groups of buyers of any available franchise stakes: Arctos Partners, Sixth Street Partners, Ares Management and a consortium comprised of Dynasty Equity, Blackstone, the Carlyle Group, CVC Capital Partners and Ludis, which is a platform founded by Hall of Fame running back Curtis Martin.
NFL commissioner Roger Goodell said it was Martin who brought together the consortium. Don Cornwell, the CEO of Dynasty, is also a former NFL employee.
"[Martin] will be investing along with them personally and to his company," Goodell said. "As well as bringing in an additional firm [Dynasty], which is primarily focused on getting people of color into ownership positions."
The league provisionally selected the firms it did because of a multitude of factors, including preferred hold times in an investment, hearing from principles of firms and understanding the commitment to the investment throughout the organization.
The structure and boundaries set up by the league was also something they wanted firms to understand. Joe Siclare, the NFL's executive vice president of finance, said they selected firms with capital ready to be used as soon as possible. The provisional approval, Kansas City Chiefs owner Clark Hunt said, is pending "long-form" agreements with the firms, but the frameworks of those deals are in place.
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