Everybody wants to have a cool friend. No matter what it costs.
For the NFL’s owners, the cost entailed allowing Tom Brady to buy a piece of the Raiders at a ridiculously low $3.5 billion valuation, according to Ben Fischer of Sports Business Journal.
The raw numbers suggest an even lower value. Per Fischer, Brady and his co-investor, Knighthead Capital Management founder Tom Wagner, will pay $244 million total for the team, $24 million of which is a prorated tax arising from the team’s 2020 relocation to Las Vegas.
That looks like a valuation of $2.2 billion for the equity.
The NFL initially balked at Brady’s bid because it set the value of the equity at too low of a price. Last year, Colts owner Jim Irsay said publicly that the price that Brady would pay wasn’t nearly enough.
“If reasonable value says . . . that 10 percent should be $525 million, you can’t pay $175 million,” Irsay said at the time.
In the end, the value was far closer to $175 million than $525 million. But, apparently, whatever Brady wants, Brady gets. Even if it de-values the equity in other teams. And even if his insistence on working for Fox as an NFL game analyst creates a clear and hopeless conflict of interest with his status as a Raiders owner.
Mark my words. One of these days, maybe later than sooner, Brady will end up as the controlling owner of the Raiders. If that transaction goes like the one the NFL just approved, he’ll get the 30 percent necessary to run the show without paying anything close to what another 20 percent is worth.
