Big Players: The Headache from the Money Chasing Around Sports Fields

Just the other day, Forbes magazine published a ranking of the highest-paid athletes of today, led by the legendary for some, and quite irritating for others, Cristiano Ronaldo. The Portuguese signed with Al Nassr, a club from Riyadh, the capital of Saudi Arabia, at the beginning of the season, where he will earn a round 200 million euros, of which 75 million euros relates to his annual salary, and 125 million euros to income from sponsorships and other marketing activities. As internet analysts quickly calculated, this translates to about 16,700,000 euros per month, or about 548,000 euros per day. Per hour, that’s about 23,000 euros, per minute around 380 euros, and per second just over six euros. Mel Brooks would say in the movie ‘History of the World, Part I’: It’s good to be a king. That saying can easily apply to Ronaldo as well. Forbes estimated that the 38-year-old footballer earned 136 million dollars last year from on-field and off-field income. The second on the list has it no easier. This is the biggest rival of the aforementioned, Lionel Messi, who stopped at a ‘modest’ 130 million dollars, while Messi’s PSG teammate Kylian Mbappé is in third place with 120 million dollars. Then there’s NBA star LeBron James with an income of 119.5 million dollars and Mexican boxer Canelo Álvarez with 110 million dollars. Golfers Dustin Johnson and Phil Mickelson occupy the sixth and seventh places with earnings of 107 and 106 million dollars, and among the top ten are NBA player Stephen Curry (100.4 million dollars), tennis player Roger Federer (95.1 million dollars), and basketball player Kevin Durant (89.1 million dollars).

Who’s Next?

The numbers that make your head spin are just a fraction of what is circulating in sports daily. The time when sports were something romantic, emotional, and entered solely out of love for a particular sport is long gone. However, times have changed, and there are probably many more like retired Cameroon national team player and English Tottenham player Benoît Assou-Ekotto, who long ago said that he is not really a big fan of football and considers it solely a job. As his coach said while he was playing in the English Premier League, ‘Assou doesn’t even know who we are playing against. He comes to the game and asks who’s next.’

—

—

Sports have become a real money-making factory, as evidenced by the salaries of the best players, the values of clubs and leagues, as well as the deep pockets of the owners of those leagues and clubs. Adding to all this is the digitalization that has enabled a truly global audience and broadcasting media rights that have become the main drivers of league revenue, leading to truly impressive figures. For example, the American National Football League (NFL) alone increased its media rights contract by 82 percent to an incredible 111.8 billion dollars in March 2021. This means that the total payout for its 32 franchises will rise from about 220 billion dollars to nearly 377 billion by 2032 when the contract expires, which is truly incredible.

In Europe, the most valuable league is the English Premier League, which, in terms of Europe, is king due to sponsorship contracts and TV rights – it is worth 9.03 billion dollars. In second place is the Spanish La Liga with a value of 5.06 billion dollars, followed by the Italian Serie A with a value of 4.88 billion dollars, the German Bundesliga with 4.18 billion dollars, and the French Ligue One with 3.88 billion dollars.

Sports Patrons

All these clubs and players need someone to finance them, so we come to the patrons who shake up the sports landscape. It is estimated that the 25 most valuable sports empires are worth a total of 173 billion dollars, which is 23 percent more than the previous year, meaning 2022.

At the top is the sports empire Liberty Media led by billionaire John Malone, worth 21 billion dollars. Liberty’s primary sports assets are Formula 1, valued at 17.1 billion dollars, and the MLB baseball club Atlanta Braves, worth 2.1 billion dollars. By the way, Formula 1 was watched by an average of 1.21 million viewers on ESPN alone in 2022, the highest since F1 began, and a new annual TV contract worth 75 million dollars was signed last July, which is a 15 percent increase over the old one. Due to the fine cash flow, the Saudi Public Investment Fund considered buying Formula 1 for 20 billion dollars last year, as Bloomberg reported at the time.

In second place is Kroenke Sports & Entertainment with a value of 12.75 billion dollars. KSE owns the Premier League club Arsenal, the NFL club Los Angeles Rams, the NBA club Denver Nuggets, and the NHL club Colorado Avalanche. Jerry Jones took third place, and his empire is built around the Dallas Cowboys and is valued at 11.32 billion dollars. Fenway Sports Group (FSG) and Madison Square Garden (MSG) Sports round out the top five, with valuations of 10.4 billion and 9.17 billion dollars, respectively.

There is also the Glazer family, which owns the English football giant Manchester United and the NFL club Tampa Bay Buccaneers; its value is estimated at 7.53 billion dollars. By the way, the Glazers are looking to offload Manchester United (and the fans wouldn’t mind either).

—

—

The highest-ranked non-American sports conglomerate on the list is City Football Group (CFG) with a value of 5.96 billion dollars. It is interesting because it is led by Sheikh Mansour bin Zayed al Nahyan with his Abu Dhabi United Group, which became known when he bought the English Chelsea from Roman Abramovich after the start of the Russian invasion. Bin Zayed also owns New York City FC and Melbourne City FC, and recently acquired the Brazilian club Esporte Clube Bahia, making it a total of thirteen clubs owned.

There are also local patriots

On the list, we have true local patriots like billionaire Ted Leonsis, who owns Monumental Sports and Entertainment and is the best example of dominating the local market. MSE owns the NBA franchise Washington Wizards and the NHL club Washington Capitals, as well as the arena where both teams play, Capital One Arena. Recently, MSE also bought 66 percent of NBC Sports programming, giving Leonsis control over the distribution of its sports content. Given that he is a local patriot, it is likely that Leonsis will soon venture into acquiring the baseball team Washington Nationals. MSE is valued at 4.51 billion dollars and is actually at the bottom of the patron table.

An example of global thinking is Kroenke Sports and Entertainment, an empire led by billionaire Stan Kroenke that stretches from England (football club Arsenal) to the western United States (NHL team Colorado Avalanche, NBA Denver Nuggets, and NFL Los Angeles Rams). The total value of KSE is 12.75 billion dollars, which is enough for second place on the list, just behind Liberty Media.

Investment firms are relatively new players and have only recently begun to enter clubs and leagues. Although there are restrictions in American leagues like the NBA, MLB, and NHL on how much institutional investors can own, there are no such restrictions in Europe, as best demonstrated by the example of RedBird Capital, which became the newest member of that prestigious group of ’25 most valuable’ by purchasing AC Milan in June last year for 1.28 billion dollars. It also bought an 11 percent stake in Fenway Sports Group, which owns stakes in the Boston Red Sox, English Liverpool, and NHL team Pittsburgh Penguins. Because of all this, RedBird is currently valued at 3.6 billion dollars and closes that prestigious ranking.

The Ten Largest Acquisitions in Sports History

Mansour bin Zayed al Nahyan (City Football Group) and his acquisition of Chelsea has so far been the largest acquisition in sports history, worth 5.4 billion dollars. However, just these days, owner Josh Harris of Harris Blitzer Sports & Entertainment, who already owns clubs like the Philadelphia 76ers and New Jersey Devils, is buying the NFL club Washington Commanders for as much as 6.1 billion dollars. Thus, the sale of Chelsea has been dethroned. Interestingly, of the ten largest acquisitions, only two are related to football clubs, while the rest of the ranking is held by clubs/franchises based in the USA. Before Chelsea and now the Commanders, the Los Angeles Lakers of the NBA held that honor when they were sold for five billion dollars. Before them, the acquisition of the NFL Denver Broncos by the Walton-Penner family for 4.5 billion dollars was the largest in history.

Another NBA team occupies fourth place, the Brooklyn Nets. Joseph Tsai bought the New York-based team in 2019 for an estimated 3.2 billion dollars. The Carolina Panthers of the NFL were bought in 2018 for 2.275 billion dollars by David Tepper, which was the fifth largest acquisition. It was a record purchase in the sports industry at the time, similar to the purchase of the Nets a year later. The LA Dodgers are the only MLB team among the ten largest sports acquisitions. Guggenheim Baseball Management bought the Los Angeles-based baseball team in 2012 for two billion dollars. Another franchise based in L.A., the LA Clippers, is next on the list. Steve Ballmer bought the team for two billion dollars in 2014. The American Glazer family bought the Premier League giant Manchester United in 2005 for 1.4 billion dollars. The last two places are occupied by NFL clubs Buffalo Bills (1.4 billion dollars) and Miami Dolphins (1.1 billion dollars).

—

—