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Saudi involvement in the NFL is inevitable, and it’s hurtling towards being a reality

May 23, 2024
in General
Saudi involvement in the NFL is inevitable, and it’s hurtling towards being a reality
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The only thing the NFL fears is being left behind. Desperate to claim a place on the world stage and expand its influence, it was only a matter of time before the league would attract the attention of Saudi Arabia. Now we’re hurtling towards that becoming a reality.

Two key news stories this week underscore how the league is inching closer and closer towards courting funds from the seemingly bottomless coffers of the Saudi Public Investment Fund — a critical initiative designed to use sports as leverage to improve the nation’s image on a global scale. This is the heart of “sportswashing,” a designed tactic to distract from Saudi Arabia’s human rights record and instead position the Saudi government as “saviors,” rejuvenating teams and turning around their fortunes. Now the NFL is on the horizon.

Middle East plans for the NFL are already in the works

A report from Front Office Sports on Thursday detailed how the NFL is exploring the possibility of playing a regular season game in Australia, as well as the Middle East in the near future. Abu Dhabi, located in the United Arab Emirates is cited as the most-likely venue for a game, with the NBA already holding a preseason game in the UAE.

Relations between Saudi Arabia and the United Arab Emirates have a complicated history and it’s woefully incorrect to lump them together. The nations don’t share a lot in common outside of being neighbors and being Islamic states — but critically UAE is viewed globally as an acceptable half-step to dip a toe in the region to take the temperature.

The NFL would not be considering a game in Abu Dhabi without an end game, and that end game would be Saudi involvement. This is critical because it dovetails into the other major football news at meetings this week.

Private Equity could be coming to the NFL

Much like reports of a game in Abu Dhabi, the ground work is being laid for NFL teams to garner ownership from private equity firms. On Wednesday owners around the league discussed this as a possibility, but stopped short of formalizing it with a vote.

It shows, at the very least, that the league is looking at the next level of ownership. The truth is that it has become prohibitively expensive for individuals, or even smaller groups to purchase NFL teams. The value of these organizations continues to soar, and frankly there aren’t enough individual billionaires with the desire or liquidity to spend the now-upwards of $6B to purchase a team.

As it stands a single owner needs to have at least a 30 percent stake in a team, and can form an ownership group to make up the other 70 percent. However, that ownership group can’t exceed 25 members total. This has prevented private equity firms, sovereign wealth funds, or pension funds from purchasing teams.

This issue is that this ownership rule is counterproductive to the NFL’s primary goal: Wealth. The league wants every team to sell for more than the last, and it never be cheaper to own an NFL team than the second it goes on sale. The moment a team sells for less than its predecessor it hints at league retraction, and that is something the NFL is desperate to avoid.

So, in order to ensure there are funds to keep purchasing teams at increasing amounts there needs to be a fundamental change to allow private equity into football — which opens the door for the Saudi Arabian Public Investment Fund, which already owns Newcastle United in the English Premier League, LIV Golf, with sights set on purchasing Formula 1.

Private Equity would be terrible for the NFL — regardless of the source

While Saudi money is correctly cited as a major problem in Western sports, the truth is that all private equity money would be terrible for the NFL — regardless of how the league spins it. As intractable and backwards as league ownership tends to be, the saving grace is that owners at least have enough of a love of football to ensure its basic tenets remain in place.

Private Equity is the slipperiest of slopes. The money injected into the NFL would jump so astronomically that it could easily compel numerous owners to cash in their teams and move on. We’re talking a bit of a doomsday scenario here to be clear, but the reality is that if enough teams become owned by private equity then league rules are open to be changed by entities who care about profit and nothing else.

If you thought ownership was bad now, you haven’t seen anything yet.

Rule changes could be small to the point of being barely perceivable, or something as dramatic as the removal of a salary cap or shift to an NBA-style luxury tax. The only limits on how much football could change is the imaginations of money-hungry private equity, and this comes with the innate NFL pressure on local governments to fund stadium works projects or risk relocation.

It’s one of those scenarios that keeps getting worse the more you think about it, and at the very least the NFL is exploring the possibility. As we’ve seen in the past if the league is brining it up for discussion it’s on the horizon, and it’s a compete understatement to assume this won’t alter the NFL in serious ways, whether through Saudi ownership or not.

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Copyright for syndicated content belongs to the linked Source : SBNation – https://www.sbnation.com/2024/5/23/24163173/saudi-involvement-nfl-game-abu-dhabi

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