Josh Harris, an owner of the NBA’s Philadelphia 76ers and the NHL’s New Jersey Devils, agreed in principle to buy the Washington Commanders for a record $6 billion (€5.4 billion) from Dan Snyder, the long-time owner of the team plagued by scandals that drew investigations from the NFL, US Congress and other government agencies.
With the end of Snyder’s tenure nearing, the NFL can begin to distance itself from a painful chapter in its history and right the future of the popular franchise, which under Snyder had been tarnished by accusations of a toxic workplace and an inability to secure a new stadium.
The sale, first reported by Sportico, was confirmed by a person with knowledge of the agreement who was not authorised to speak publicly about the terms.
The agreement comes as the NFL continues its second investigation into allegations of widespread sexual harassment made against executives at the team, including Snyder, as well as potential financial improprieties. Those allegations, coupled with Snyder’s inability to build a new stadium and a backlash from the team’s fans, had pushed many of the owners of the league’s other teams to consider voting to force him to sell the team, which he bought in 1999 for $800 million.
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Harris’ group includes Mitchell Rales, a billionaire from the Washington, D.C., area, and a group of limited partners that includes Magic Johnson. Once they submit the deal, the sale would have to be approved by the league’s finance committee and by at least three-quarters of the 31 other team owners, who next meet in person on May 22nd and 23rd in Minneapolis.
Spokespeople for the Commanders, the NFL and Harris declined to comment on the agreement.
Last June, the Walton family, founders of Walmart, bought the Denver Broncos for $4.65 billion, about twice as much as the previous record high for an NFL team.
Snyder and his wife, Tanya, a co-owner of the team, formally began a search for a buyer in November 2022, when they hired Bank of America to seek offers for all or a portion of the Commanders. They began to field offers just weeks after Jim Irsay, the owner of the Indianapolis Colts, said Snyder “needs to be removed,” confirming what owners had been saying privately for months.
In recent years, Snyder has fended off a growing array of scandals and legal challenges. In July 2020, Snyder ceded to years of pressure, including from one of the team’s biggest sponsors, FedEx, and agreed to change its long-time name, which many considered a slur against Native Americans.
Weeks later, dozens of women accused Snyder and top executives of sexual harassment of woman employees. Snyder hired a prominent Washington lawyer to look into the charges, which were detailed in The Washington Post, but the league quickly took over the investigation.
“Today marks the end of a long, difficult chapter for all employees and fans of the Washington football organisation,” Lisa Banks and Debra Katz, the lawyers for more than 40 former Washington Commanders employees who levied claims of workplace violations, said in a statement. “We are proud of our many clients who made this moment possible – the brave women and men who came forward repeatedly and at great personal risk to expose the decades of sexual harassment and financial wrongdoing at the team.”
Snyder sued his limited partners claiming that they had tried to smear his reputation to undermine his ownership of the team, triggering a highly contentious legal battle that included accusations that Snyder financially mismanaged the club. The dispute went to a league-appointed mediator and ended in spring 2021 after the owners allowed Snyder to take on $450 million in additional debt so he could buy out the three limited partners whose stakes amounted to 40% of the club.
In July 2021, the league fined the club a record $10 million and ordered Snyder to stay away from the team after a league-helmed investigation found that a rampant culture of sexual harassment perpetuated by managers and executives had persisted at the team for more than a decade, and that Snyder had done nothing to stop it.
Although some executives were fired and others left, Snyder urged the league to keep the specific findings private, and Commissioner Roger Goodell released only a cursory summary. This led a congressional committee to launch its own investigation into the treatment of women in the team’s front office. Witnesses testified to new claims against Snyder, who was deposed for more than 11 hours.
After the new allegations arose, the league ordered a second investigation led by Mary Jo White, a former federal prosecutor. The NFL has yet to release her findings.
In November 2022, the U.S. Attorney’s Office in the Eastern District of Virginia opened a criminal investigation into allegations that the team committed financial improprieties. Snyder and the team were also sued by the attorneys general of Virginia and the District of Columbia. The latter case was settled, with the team agreeing to pay a $425,000 fine and refund about $200,000 in deposits to season-ticket holders.
Amid the legal inquiries and diminished public support, Snyder faced significant challenges in building a new stadium in the region to replace the ageing FedEx Field, which opened in 1997 and has been plagued by pipe leaks and other structural failings.
The Commanders finished with winning records in just six of 24 seasons and won just two playoff games under Snyder. The losing, coupled with the creaky stadium, began to repel fans. The team routinely played to sold-out crowds during the 1980s and 1990s, but ranked near the bottom of the NFL in home attendance in recent seasons.
Still, Forbes in 2022 ranked the Commanders the eighth most valuable team in sports, ahead of the NBA’s Los Angeles Lakers and Manchester United of the Premier League, in large part thanks to the NFL’s revenue sharing model and the windfall ensured by football’s media rights deals.
Last month, Jason Wright, the team’s president, said the Commanders had improved their eroding finances after years of declining ticket and sponsorship sales, making the team more enticing to potential bidders.
“There will be people that come to partner with us that were unwilling to partner with us before, not necessarily because of ownership from a personal standpoint, but because of things that were said about the organisation in the past,” Wright said.
Harris, a founder of the private equity firm Apollo Global Management, leads the Harris Blitzer Sports & Entertainment holding company, an investment group that has revitalised the 76ers and the Devils. He is also an owner of the Premier League’s Crystal Palace football club and holds a minority share in the Pittsburgh Steelers, which he must sell so he can take over ownership of the Commanders.
Harris, who grew up in Chevy Chase, Maryland, and attended the Field School in northwest Washington, cobbled together a big investment group. A week before the preliminary bids were due in February, he toured the team’s training facility and stadium, as every qualified bidder is allowed to do, according to a person familiar with the Commanders’ sale process.
The bid process was complicated because interest rates had shot up in the past year, raising the cost of borrowing money. Formerly a high-profile team owner, Snyder has remained largely out of public view and away from the team.
According to NFL rules, every club must have a principal owner who owns at least 30 per cent of the team, which means Harris will need to raise at least $1.8 billion on his own. He has an estimated net worth of $6 billion, according to Forbes.
In March, Harris recruited Rales, a co-founder of the Maryland-based Danaher Corp., to join his investment group, a person with knowledge of the deliberations said. Rales has an estimated net worth of $5.6 billion, according to Forbes, and adds strong local ties to the ownership group.
Harris also recruited Magic Johnson, which will help satisfy other NFL owners, who last March said in a statement that they would “regard it as a positive and meaningful factor” if prospective ownership groups “include diverse individuals who would have a significant equity stake in and involvement with the club.”
Harris beat out Tilman J. Fertitta, the owner of the NBA‘s Houston Rockets, who reportedly bid $5.6 billion for the Commanders. Jeff Bezos, the founder of Amazon, was thought to be interested in buying the club, but does not appear to have made a bid for the team. – This article originally appeared in The New York Times.
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