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Old 05-07-2019, 12:49 PM
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Publicly traded pro sports league?


So Omniscient mused a little bit here on what might happen if Green Bay Packers stock was allowed to work like garden variety corporate stock, and ends by pointing out how a publicly traded league would be horrible.

What I'm curious about is what all that would imply?

I can see the stock prices being absurdly volatile, and trading happening in weird bursts during each week. It would be like a team released quarterly results every game. In particular, the NFL would see significant churn every week, I suspect, while games with a lot of games would probably see prices reach more of an equilibrium.

What else might happen? Profit sharing with players? How would SOX audits work? And so on...

Last edited by bump; 05-07-2019 at 12:50 PM.
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Old 05-07-2019, 01:15 PM
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Are you talking about the League being publicly traded or the individual teams?

Because I don’t see how weekly results would affect the overall value of the NFL and for individual teams, profitability is not always correlated with winning games or championships.
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Old 05-07-2019, 01:41 PM
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The original thread was about the Packers being publicly traded, and in context it looks like the idea here is that each team would be a publicly-traded, for-profit entity.

One thing I think would be weird is gambling. The NFL is embracing the idea of sanctioning gambling and looks to get a new revenue stream from it. So you’d have that, and stock prices, and people making money from fantasy football. It seems kind of obscene to me.
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Old 05-07-2019, 02:19 PM
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Some European soccer teams are publicly traded, Manchester United for one.
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Old 05-07-2019, 03:02 PM
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While winning does increase the revenue streams for a team (t-shirt sales, advertising, broadcast numbers, ticket sales) many teams with many losing seasons have rabid fan bases to buffer that volatility.

Here's the Forbes 2018 list of NFL teams net worth. https://www.forbes.com/nfl-valuations/list/ It seems to be mainly correlated to city size, although there are some exceptions. Boston is a fairly big market but not one that would result in a #2 ranked team if it were not for the last two decades of success.

But Dallas is #1 and they haven't gotten past Divisional weekend since 1995. And the Jets are just awful, and they're ranked #8.
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Old 05-07-2019, 04:09 PM
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Originally Posted by USCDiver View Post
Are you talking about the League being publicly traded or the individual teams?

Because I donít see how weekly results would affect the overall value of the NFL and for individual teams, profitability is not always correlated with winning games or championships.
The individual teams.
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Old 05-07-2019, 04:54 PM
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What else might happen? Profit sharing with players?
There's nothing in the current rules that prohibit the owners from sharing their profits with players.

One thing I can see is a shareholder's meeting where angry fans vote to fire the coach. I guess the board of directors could meet every week and vote whether to fire the coach over the general manager and CEO's objections. In fact, I suppose shareholders could sue the board for not fulfilling its fiduciary obligation because the team has a losing record and the coach/GM/CEO hasn't been replaced fast/often enough.

As one local morning DJ once said, "This is America. Anyone can sue anyone for anything!" And shareholders might be able to prove damages.

Last edited by Kent Clark; 05-07-2019 at 04:56 PM.
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Old 05-07-2019, 06:27 PM
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There's nothing in the current rules that prohibit the owners from sharing their profits with players.
Are you sure? That sounds like a really good way to get around the salary cap. I think if it was allowed it would be happening. Like, everywhere.
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Old 05-07-2019, 08:38 PM
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Are you sure?
I'm not sure, but I think if an owner announced he announced he would share X% of profits equally among all the players/players and coaches/everyone connected to the team, he could certainly argue that shouldn't count against the cap because it isn't "salary."

Of course, that would mean an owner would voluntarily open his books to someone other than his fellow owners.

Last edited by Kent Clark; 05-07-2019 at 08:38 PM.
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Old 05-07-2019, 11:19 PM
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I'm not sure, but I think if an owner announced he announced he would share X% of profits equally among all the players/players and coaches/everyone connected to the team, he could certainly argue that shouldn't count against the cap because it isn't "salary."

Of course, that would mean an owner would voluntarily open his books to someone other than his fellow owners.
I would strongly suspect that the North American pro leagues which have salary caps would absolutely argue that such profit-sharing would count against the salary cap, and I have a hard time seeing how an owner would successfully argue otherwise. Things that aren't strictly "salary" (such as signing bonuses) are still calculated against a player's cap number (though often amortized over the length of their contract).

Also, FWIW, part of the reason that people who study the finances of professional sports find the Packers so interesting is exactly because they do open their books up to the public (the only NFL team which does so).

Last edited by kenobi 65; 05-07-2019 at 11:21 PM.
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Old 05-08-2019, 10:41 AM
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The Atlanta Braves are publicly traded (more or less). Ticker symbol is BATRA. They're part of the Liberty Media complex, which is one of the most confusing corporate entities that I'm aware of. Here's the annual report if you want to dig into the numbers.
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Old 05-08-2019, 04:40 PM
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Originally Posted by kunilou View Post
One thing I can see is a shareholder's meeting where angry fans vote to fire the coach. I guess the board of directors could meet every week and vote whether to fire the coach over the general manager and CEO's objections. In fact, I suppose shareholders could sue the board for not fulfilling its fiduciary obligation because the team has a losing record and the coach/GM/CEO hasn't been replaced fast/often enough.
That's the exact sort of consequence I was thinking about- what level of input into the team functioning would the shareholders have? Let's say there's no majority shareholder, so could the shareholders stage a revolt against the board because they did/didn't do X, Y or Z?

Also, what sorts of audits would be conducted? How far into the actual sports operations would the auditors delve?
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Old 05-08-2019, 08:14 PM
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I would strongly suspect that the North American pro leagues which have salary caps would absolutely argue that such profit-sharing would count against the salary cap, and I have a hard time seeing how an owner would successfully argue otherwise. Things that aren't strictly "salary" (such as signing bonuses) are still calculated against a player's cap number (though often amortized over the length of their contract).
I'm not disagreeing with you, but I'll just say it would be an interesting test case.

And my POV is biased because I live in St. Louis, where both public bodies and indivduals are suing the Rams and Stan Kroenke for anything they can think of, and Rams/Kroenke are countersuing at equal frequency for anything they can think of.
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Old 05-08-2019, 11:28 PM
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Originally Posted by bump View Post
That's the exact sort of consequence I was thinking about- what level of input into the team functioning would the shareholders have? Let's say there's no majority shareholder, so could the shareholders stage a revolt against the board because they did/didn't do X, Y or Z?
Assuming that the teams structured themselves similarly to other publicly-traded companies, shareholders would be unlikely to have a direct say in the day-to-day operations of the teams. Shareholders would be allowed to vote for (or reject) a proposed board of directors, which would have more direct control over the team (including hiring and firing of management).

You could certainly have a shareholder revolt, but unless a team was crazy enough to be willing to put personnel decisions to a direct shareholder vote, such revolts would most likely entail voting in a different board of directors.

Last edited by kenobi 65; 05-08-2019 at 11:31 PM.
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