Josh Kosman from the New York Post reports that the USFL is seeking outside investors to help fund team expansion. We have heard for quite some time that teams will only move into their home locations if a team owner is paying for it.
This is why the league references itself as an incubator. They want people with money to come in and buy teams, which FOX believes will be worth a lot of money.
“Fox Sports-owned United States Football League has hired investment bank Allen & Co. to find minority investors to help fund the league’s expansion, three sources with knowledge of the situation said.”
Allen & Co is the same firm that helped with the recent sale of the Denver Broncos.
“Fox’s plan is to raise between $150 million and $200 million, two sources said.”
According to multiple reports, FOX plans to invest $150 million over three years in the new USFL, with year one coming to a close this weekend. This means FOX is looking to inject even more capital.
Whether the USFL finds someone in the next six months or not, year two is a go.
“Fox plans to keep the league going next year even if it cannot find the right investor, sources said, and is controlling costs by using some of Fox’s infrastructure, including its marketing team.”
Kosman says that the USFL ratings are on par with the MLS. So then, in effect, their teams are worth the same.
“With MLS franchises now worth about $400 million each, the math goes that the USFL with its eight teams could be worth at least $3.2 billion a few years down the road.”
It should be noted that News Corp, which owns FOX and the USFL, also owns the New York Post. It looks like the USFL is putting the word out that they are looking for minority investors.
Based on the math, the league is looking to get at least 20 million per team. It should be noted that soccer is way cheaper to field than a football team. But the lure of a 20 million dollar investment turning into 200 to 400 million in 10 years would be a good investment if you had the money.
We will keep you posted on USFL News Hub as this story develops.