Moag & Company Sports Notes (2 July 2021)

Date: Jul 2021

Trivia

What is the most valuable sports team in the world?

Last Week’s Answer: There will be four sports new to the Olympics in the upcoming games; karate, skateboarding, sport climbing, and surfing.

Football:

The high-stakes trial over the estate of deceased Denver Broncos Owner Pat Bowlen has been canceled just 13 days before it was set to begin, strongly suggesting a settlement is at hand. Arapahoe (CO) County District Court Judge John Scipione signed a motion to stay all proceedings on Tuesday, according to people familiar with the case. The motion was proposed jointly by attorneys for both the three trustees overseeing the Patrick D. Bowlen Trust and his two oldest children, Amie Bowlen Klemmer and Beth Bowlen Wallace. While the abrupt cancelation of the trial indicates some kind of settlement is either complete or close to completion, details are unknown. It could mean the Broncos are headed to the market in fairly short order. If a controlling stake of the Broncos were sold outside the family, it would almost certainly set a new high-water mark for a sports franchise, experts have said. Forbes last valued the Broncos at $3.2 billion, and experts say its location in the rough center of the country, national fan base, historical record of on-field success (albeit not recently) could push that price higher. Another possibility is that the two sides are still at odds, but they have decided the public disclosure of team or NFL business secrets was against both of their interests. The NFL has been known to intervene in team disputes to avoid public court battles, and had initially assigned former Browns and 49ers executive Carmen Policy to arbitrate the Bowlen matter before it went to court. For months, NFL and sports finance insiders have considered a sale outside of the Bowlen family likely, due to the acrimony and seeming improbability of the family coming to terms. In December, Klemmer and Wallace called for a sale, suggesting they would abandon the trial if the trustees agreed to sell: “Watching these past few seasons has been extremely painful and we continue to see no other way to restore the franchise for our fans but through a transition of ownership of the Denver Broncos. ... We have been committed to and will continue to pursue resolutions on all issues in order to ensure a smooth and timely transition." Even if the trustees would have won the trial and a clear judicial ruling that the terms of the Bowlen trust were valid, they would face tall hurdles to installing 31-year-old Brittany Bowlen as principal owner without agreement from the family. Brittany Bowlen has emerged as the trustees’ clear choice over her six siblings.

Hockey:

NHL Commissioner Gary Bettman, during his state of the league address, confirmed that the economic hit the NHL sustained as a result of the pandemic has led to the league altering its approach toward supporting a women’s professional hockey league in North America, according to the Associated Press. Bettman "urged" the NWHL and PWHPA to "bridge their differences first." Bettman said, "If you’re going to make a go of a new league, you’ve got to have all ducks in a row. And our hope is the women’s professional landscape can be more unified going forward." This is a switch from Bettman’s previous stance in which he said the NHL would only step in to support a pro women’s league should the two entities -- the NWHL and now-defunct Canadian Women’s Hockey League -- step aside. Meanwhile, the NHL pledged to spend $5 million over the next 18 months on diversity and inclusion efforts in a league that remains primarily white and has no Black coaches or general managers.

Baseball:

 U.S. Sen. Richard Blumenthal (D-Conn.) introduced the Saving Minor League Baseball Act, a $550 million federal relief fund for minor league baseball teams impacted by the COVID-19 pandemic according to The Hartford Courant. The fund would apply to all minor league teams across the country, with a maximum of $15 million available to each team. The measure of how much each team receives would be determined by how much its shortfall in revenue has been. Blumenthal said that "he’s pushing for the act," co-sponsored by U.S. Sen. Marsha Blackburn (R-Tenn.) to be "included in the next federal infrastructure bill." Blumenthal added that the bill "has bipartisan support".

Basketball:

Sponsorship measurement firm IEG estimates the NBA and its 30 teams brought in record sponsorship revenue during the '20-21 season despite a shorter season according to SportsBusiness Daily. IEG pegs NBA sponsorship spending at $1.46 billion, up more than 6% year-over-year. IEG’s Sponsorship Intelligence Database shows league-level partnerships led the surge, with the NBA reaching 13 new deals including one with Microsoft. NBA league-level sponsorship spending is up by nearly 50% since '17-18. The jersey patch addition has had a significant impact the past several years, with IEG Global noting some of those deals are worth $15 million-plus annually. Tech was the top sponsorship category during the '20-21 NBA season, with nearly $115 million in new spending. Lottery and gaming brands were also very active new spenders, putting almost $50 million of new money on the books. The most active brand categories in the NBA are insurance, retail, beer and wine/spirits, with each category holding in excess of 70 individual deals. The most involved brands based on the number of partnerships are State Farm, Anheuser-Busch and Verizon. Verizon alone inked 12 new NBA deals last season.

Soccer:

Juventus is planning a capital increase of up to $474 million to shore up its finances after the COVID-19 pandemic impacted its sales as reported by Bloomberg News. The proposed capital increase is set to be approved at the club’s next board of directors meeting in September. Club owner the Agnelli family’s holding company, Exor NV, which holds a 64% stake of Juventus, has expressed its support for the transaction, the company added. Exor said it expected a negative impact of $379.4 million in the '19-22 period from the pandemic.

Other:

Formula One has landed a new sponsor in a deal with cryptocurrency exchange platform Crypto.com according to CNBC. Terms of the agreement were not provided, but sources said that it is a five-year deal that totals over $100 million. Crypto.com will get brand presence around F1 events, including the new Sprint qualifying format that will be used in some races to determine the starting positions of the cars. In addition, Crypto.com will receive trackside slots at F1 races for the remainder of the season. The company will also introduce a new award at F1′s Belgian Grand Prix in August and become its NFT partner. The agreement takes effect July 17. Crypto.com claims that it has over 10 million users.

Sources: Bloomberg News; CNBC; SportsBusiness Daily; The Associated Press; The Hartford Courant

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