Could Jon Bon Jovi add 'owner of the Buffalo Bills' to his repertoire?
A potential ownership group that includes Bon Jovi has conducted a feasibility study into buying the Buffalo Bills and building a NFL stadium in Toronto, according to the Associated Press. The study looked into at least three potential stadium cites – two in Toronto and one in the nearby suburb of Mississauga, an source close to the matter told the AP. However, other sources also say the group plans to keep the team in Western New York.
Either way, the Bills have been up for sale since owner Ralph Wilson died in March. On Tuesday, prospective bidders have to submit a form incl uding an initial, non-binding bid to buy the team, the AP reports. That includes Donald Trump and Terry and Kim Pegula, owners of the NHL's Buffalo Sabres. But how much would the Buffalo Bills go for?
The team is valued at $870 million, according to Forbes. The Bills could be sold for $1.1 billion, a league source told ESPN. Values of NFL franchises rarely go down – most of the time, value increases, especially when a team comes with upgrades like a brand new stadium. The Bills signed a lease in December 2013 to stay in Buffalo until 2020. As part of the agreement, the state and county will pay $95 million toward a $130 million renovation of Ralph Wilson Stadium. Either way, a new stadium or a recently-renovated one would add value to the Bills.
However, the value doesn’t always mirror the costs. As seen with the Los Angeles Clippers, former Microsoft CEO Steve Ballmer bought the NBA team for $2 billion, even though Forbes valued the team at $575 million. It may have been a hasty sale that drove up the price. Still, the Bills could be sold for a lot of money.
Unlike NBA teams in recent years, NFL teams are rarely on the market. The Cleveland Browns were reportedly sold for more than $1 billion to Jimmy Haslam in 2012, according to ESPN. Other teams have had different owners, but most of the time it is family ownership being split up by children or grandchildren of the previous owner.
With current NFL ownership rules, there has to be a principal owner in an NFL franchise, or one person that owns at least a 30 percent stake in the team. The exception is the Green Bay Packers, which is owned by a public corporation. As for the Bills, the current lease says the team or Wilson's estate cannot negotiate with anyone who has known intentions to relocating the NFL franchise before the lease expires at the end of the 2022 season. If Bon Jovi or anyone in the group makes it known that they want to move to Toronto, they cannot negotiate to buy the team.
Another financial consideration is TV contracts. The NFL’s extensions of its Sunday television contracts with CBS, FOX, and NBC will start this season and run through the 2022 season. Financial terms were not released, but Forbes reported the three networks would pay about $3 billion a year, making the deal worth $27 billion.
In 2013, each NFL club received $131 million from the three networks, plus ESPN and DirecTV, according to the Buffalo Business News. But, that was when CBS, FOX, and NBC paid about $1.93 billion to the NFL, so every NFL franchise will see more money with the newer TV deal.