National Football League owners approved Tom Brady as minority owner of the Las Vegas Raiders on Tuesday.
The seven-time Super Bowl champion bought about a 10% stake in the Raiders with his business partner, the founder of Knighthead Capital Tom Wagner.
Brady and Wagner are buying the Raiders at a valuation of about $3.5 billion, with an equity investment of about $220 million as part of the partnership, according to people familiar with the negotiations. On top of that amount, Brady and Wagner also had to pay a 10 percent “flip tax,” the proceeds of which would be shared among the league’s 31 other owners.
Separately, former NFL player Richard Seymour bought less than 1 percent of the Raiders, also at a $3.5 billion valuation, the people said.
The NFL’s 32 team owners signed off on the deal unanimously at the league meeting in Atlanta, the person told CNBC. Brady and Wagner did not attend the meeting, according to a person familiar with the matter.
“I’m eager to contribute to the organization in any way I can, honoring the rich tradition of the Raiders while finding every opportunity possible to improve our offering to fans … and most importantly, WIN football games,” Brady said in a statement.
CNBC’s Official 2024 NFL Team Valuations pegged the Raiders as the NFL’s fifth-most valuable franchise at $7.8 billion, meaning Brady and Wagner were a 50 percent discount. The typical discount for a limited partner who has no say in how the team is run and no path to controlling ownership is 20% to 25%, according to sports bankers.
The Raiders’ value has risen since the team relocated from Oakland in 2020. Prior to the move, the team was valued in the bottom half of the league’s 32 teams.
Since the team moved to Las Vegas and their new stadium, their revenue has increased significantly. The Raiders earned $780 million in revenue in 2023, the third-highest in the league, and generated EBITDA of $115 million, according to CNBC estimates.
While Allegiant Stadium is among the smallest in the NFL at 65,000, the Raiders have compensated by charging the highest ticket price in the league, CNBC previously reported. The average general ticket price last season was $169.
Allegiant Stadium, which is operated by the Raiders, also hosts numerous non-NFL events throughout the year, which generates additional revenue for the franchise. In 2023, the Raiders earned over $50 million from concerts and other events like college football.
Brady’s bid for a piece of the team began in May 2023 but was postponed because some owners felt that the original offer was greatly reduced.
After first retiring from the NFL, Brady signed a 10-year, $375 million broadcast deal with Fox Sports through 2022. Brady’s new ownership will come with limitations about how it covers the team.
For example, Brady would be allowed to broadcast Raiders games, but would not be allowed to attend in-person or online production meetings. He may also not have access to team facilities, players and coaches.
Brady will also be subject to league rules that prohibit public criticism of officials and other clubs.
The five-time Super Bowl MVP is not new to the Las Vegas sports scene. He is also a minority owner of it Las Vegas Aces of the Women’s National Basketball Associationwhich, like the Raiders, is owned by Mark Davis.
Brady will be just the third former NFL player to become a team owner.