SBJ/April 29-May 5, 2013/Leagues and Governing Bodies

NFL will still pick out new owners

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The NFL does not plan to stop handpicking prospective owners in the wake of the federal investigation of Cleveland Browns owner Jimmy Haslam’s private company, sources said last week.

The NFL chose and encouraged Haslam on the Browns purchase. Prior to that, the league did the same with Shahid Khan and his acquisition of the Jacksonville Jaguars.

Khan and Haslam, the league’s two newest owners, were the first to emerge from a recent league initiative led by Eric Grubman, NFL executive vice president, to pair specific wealthy individuals with teams for sale. Before Khan and Haslam, typically a selling owner’s investment bank would find buyers, and then the NFL would screen those candidates.

Haslam
That means, in Haslam’s case, the league not only conducted due diligence on Haslam prior to his Browns purchase, but the league was engaged with him from the start, bringing the truck stop magnate to the Cleveland sale in the first place.

“The NFL is likely to try to be involved in these transactions as they have for the past several years, because it gives membership and league staff the best opportunity to get to know new owners before they take control,” said a source close to the NFL.

Both Khan in 2011 and Haslam last year were quietly introduced by the NFL to the selling franchise owners, and deals flowed from there before any notice went public that the clubs were for sale. In Haslam’s case, the league contacted him last June; he met with Browns’ then-owner Randy Lerner in early July; and the duo announced a transaction the following month. (Haslam was already a minority owner of the Pittsburgh Steelers, so the league knew him from that involvement as well.)

A former NFL official said that while a timeline of that nature may seem rushed, it’s not out of the norm. This type of quick succession could also prove advantageous if an owner were to die. The death of an owner without a potential successor already lined up could leave a team run by an estate for a period of time.

NFL Commissioner Roger Goodell last week said the league had no inkling of the April 15 FBI raid on Haslam’s Pilot Flying J in Knoxville, Tenn., and the subsequent lawsuit accusing the company of defrauding trucking clients. Haslam has denied the FBI’s allegation that he knew about the alleged fraud.

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