Sale of Denver Broncos

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Halas Hall
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Joined: Sat Oct 25, 2014 10:00 pm

Sale of Denver Broncos

Post by Halas Hall »

I read the Broncos were sold for 4.65 Billion and thought what exactly does the buyer get? I imagine the facility is included, the trademarks etc. An team does not have that many employees. The team charter plane? I guess the big one is the right to their share of the TV money.

Thanks.
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65 toss power trap
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Re: Sale of Denver Broncos

Post by 65 toss power trap »

Obviously, the major asset is the franchise certificate. This also confers rights to the home territory and well as "home marketing area" rights that include a share of Mexico with 8 other clubs. Trademarks and intellectual property are assigned to the new ownership.

Title on player and executive contracts transfer to an operating company of the new ownership. The stadium is publicly owned, so the lease is assigned to the new football operations company. As recently as 2018, the team charters a plane for their away games, so there are no tangible assets there. I'm fairly certain the practice facility and team headquarters are not leased, so the real estate and improvements are all fixed assets.

Employees not under contract have technically been terminated by the operating company for the Bowlen trust and re-hired by the Walton operating company. As a pratical matter, there is likely very little change, but the new owners are not obligated to retain anyone not under contract.

Other assets would include any contracts that the previous ownership engaged in (airline charters, service contracts, PSL agreements, sponsorships, etc.).

As I understand it, a corporate entity is designated as the "football company" in which the only material asset is the member club and its sole stated purpose is the operation of a football team. The football company is 100% owned by a holding company, which would be created by the Walton ownership group. The holding company is owned by a panalply of individuals, LLCs, and other holding companies create a galaxy of ownership of the team operations and anything else the holding company has a partial/full title to (parking concessions, marketing operations). All of this protects the NFL's crown jewels: the franchise certificate. If the Waltons were somehow to declare bankruptcy or if there was a judgement against any of the holding company's owners or interests it owns, the franchise is firewalled. In the case of a bankruptcy, the NFL would immediately take control of the football company (according to the NFL bylaws) so that it cannot be used as an asset to satisfy creditors. A wealthy individual with a Kraftian ability can squeeze out an owner to sell the team, but it would still be at the approval of the owners and never by liquidation.
Halas Hall
Posts: 186
Joined: Sat Oct 25, 2014 10:00 pm

Re: Sale of Denver Broncos

Post by Halas Hall »

65 toss power trap (great name) - Thank you very much for laying all this out, extremely interesting.

Thanks again.
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