Tom Brady and Tom Wagner aiming £460m investment

Birmingham City owner Tom Wagner and club investor Tom Brady are considering an investment in the NFL.

According to US sports business website Sportico, seven-time Super Bowl champion Tom Brady is apparently organizing a potential purchase of shares in the Las Vegas Raiders, which were acquired by Wagner last year. Wagner, co-founder of Knighthead Capital, is leading the effort to coordinate finance for the deal.

Brady’s investment in the Raiders has been delayed for nearly a year after certain NFL club owners voiced dissatisfaction with the franchise’s valuation in relation to the shares Brady sought, with reports indicating it was as much as 70% below market value.

However, Brady, Wagner, and their investment group have returned to the table with a revised proposition based on a higher value of the team. Sportico estimates the Raiders’ worth at $5.77 billion (£4.6 billion), while Forbes puts it at $6.2 billion (£4.9 billion).

According to the Sportico article, the consortium is seeking a ‘little over’ 10% equity investment, with Brady holding up to 7%.

A 10% stake at a valuation of £4.9 billion would be worth £490 million, but there are other factors at play that could drive down the valuation, most notably significant debt on the balance sheet related to the financing of the construction of their Allegiant Stadium home, which cost $1.9 billion (£1.5 billion) to build and has debt of up to £1 billion. There is also the reality that minority holdings are sometimes purchased at a lesser price than majority stakes.

Brady and Wagner have been friends for years after their children attended the same New York City school. Brady, head of the Advisory Board at Blues, resigned from a dazzling playing career in early 2023. They are now active investors in sports and related enterprises.

The Blues were acquired after they invested in a Major League Pickleball club, which has also attracted investment from basketball icon and partner in Liverpool’s Fenway Sports Group, LeBron James. Knighthead is committed to Blues for the long run, according to insiders, and the club has a 10-year strategy.

NFL franchise valuations are the highest in the world, thanks to long-term TV deals that provide financial certainty for owners and the sport’s continued popularity in America. The current media contract is worth $100 billion and spans more than ten years.

While the valuation trend is not projected to continue at the same rate as in previous years, team valuations are expected to rise further, making it an appealing investment opportunity for those with significant resources.