Colin Kaepernick and P-Diddy Buying the Carolina Panthers? Now, That’s “Fantasy” Football
During the milieu that is the holiday season, we didn’t want to miss covering the story which broke last week about former professional quarterback Colin Kaepernick and current professional noise-maker Sean “P-Diddy” Combs expressing an interest in buying the NFL’s Carolina Panthers.
Frankly, that has about as much chance of happening as my getting elected Pope during a hailstorm while I’m being attacked by a water buffalo in the parking lot of a Wal-Mart in Kearny, Nebraska. That’s really a low-down, crying shame because a Kaep-Diddy ownership group might be the best thing to happen to the dysfunctional train-wreck which is today’s National Football League.
I’m going to tease out the reasons why as I give the original story another one of our patented Dubsism breakdowns, because the good people at Yahoo Sports really try not to tell you why these two dreams of NFL ownership at this point are of the highest Quixotic order. While they admit the presence of the windmill, they want you to think charging it is not only practical, but purposeful.
In a sign that Sean “Diddy” Combs is serious about making a push to buy the Carolina Panthers, the hip-hop mogul is moving to set meetings with potential investors in hopes of shaping a prospective ownership group, two sources familiar with Combs told Yahoo Sports. Those efforts are expected to include the involvement of Colin Kaepernick, who had a lengthy call with Combs to discuss the former NFL quarterback’s role in forming an ownership group.
Combs declared Sunday that he hoped to purchase an NFL team shortly after Panthers owner Jerry Richardson announced he would be putting his controlling share of the franchise up for sale. Kaepernick echoed Combs’ interest Sunday and began moving forward with plans this week. According to a source close to the quarterback, Kaepernick has already begun reaching out to a handful of business leaders, venture capitalists and sports icons to discuss an ownership group. The source close to Kaepernick said the quarterback had a “shared vision” with Combs about creating an ownership group that more closely represents the racial makeup of the league’s players, which is about 70 percent African-American. To date, the NFL has never had an African-American majority owner.
“The interest is real and it’s moving forward,” the source said of Combs and Kaepernick working together. “They want to make this a reality. It’s serious.”
To keep with the “Don Quixote” reference, Kaep and P-Diddy in this case are clearly “dreaming the impossible dream.”
Combs has said he was interested in owning an NFL franchise, but the opportunity, timing, and finances failed to align.
Opportunity and timing are the easiest to understand. There are only 32 franchises in the NFL, and they don’t come up for sale very often. Here’s the last five franchise purchases by date, original price, and current value.
- Buffalo Bills, bought by Terry Pegula in 2014 for $1.1 billion, currently valued at $1.6 billion
- Cleveland Browns, bought by Jimmy Haslam in 2012 for $1 billion, currently valued at $1.95 billion
- Jacksonville Jaguars, bought by Said Khan in 2012 for $770 million, currently valued at $2.075 billion
- Los Angeles Rams, bought by Stan Kroenke in 2010 for $750 million, currently valued at $3 billion
- Miami Dolphins, bought by Stephen Ross in 2008 for $1.1 billion, currently valued at $2.575 billion
There have been five franchises sold in the last 10 years, and all of them like the rest of the league have have shown a serious increase in value. Keep that fact in mind as we walk through this, because this is the part where we’re going to look at a potential sale price for the Panthers, keeping in mind that Jerry Richardson does not own all of the franchise.
While Richardson has full control of the Panthers, his family owns only 48 percent of the franchise, with the remainder possessed by a collection of investment partners. However, a league source told Yahoo Sports that the sale of Richardson’s percentage is expected to constitute a controlling share, based on the power structure established by the founding partnership. In essence, anyone purchasing Richardson’s 48 percent would take over control of the franchise.
Red Flag #1 – Show Me The Money
Richardson’s 48% share is a controlling interest for two reasons. The first is he own his share singularly, making him the largest individual shareholder. Kaepernick and P-Diddy are already talking in terms of “ownership group,” which means they don’t have the money and they would need to assemble any such “group” into a single legal entity for purposes of maintaining the controlling interest of the 48% share, or they have to be able to purchase at least 30% of the Panthers total shares. More on that later…
The second reason is Richardson holds the controlling interest because of contractual agreements with the other individual owners. Those agreements likely disappear with a sale and even if those relationships were constructed with the option to survive an ownership change, there’s still the ever-present possibility the minority owners unite against the 48% share.
Let’s look at the money issue first.
…although it’s unclear if he has the funds necessary to make the purchase outright. In September, Forbes tagged the Panthers as the 21st most valuable franchise in the NFL, with a valuation of $2.3 billion. Given the bump that franchise values typically experience in sale situations, a 100 percent sale of the Panthers would likely be estimated to cash out at $2.5 billion or more – projecting Richardson’s controlling 48 percent stake somewhere in the neighborhood of $1.2 billion.
Based on Forbes’ financial projections, that price tag would seemingly put an outright purchase beyond Combs’ reach. Earlier this year, Forbes pegged Combs’ net worth at $820 million. That figure is not meant to signify liquid assets. Instead, it’s a best-guess number based on Combs’ earnings and investments in the music, entertainment and fashion industry, as well as significant stakes in various beverage and business industries. For Combs to purchase the Panthers largely on his own, it’s likely he would have to either liquidate or leverage a significant number of his investments, while also taking out loans to cover the remaining cost.
In other words, Diddy doesn’t have that much rain. The people at Yahoo who wrote the original story know that. So, why are they pumping out this bit of non-sense? All I’ve got to do is give them enough verbal rope; they’ll hang it right out there for you.
Red Flag #2 – There’s Too Many Bigger Fish
Stemming from the splintered group ownership model, and doubling-down on the aforementioned money issue, there is the issue of the other owners. What if one or more of the Panthers’ minority owners decides this is a good time cash out? You can’t tell me that isn’t a distinct possibility. It’s also entirely possible that one of the current minority owners buys Richardson’s share, and there’s plenty of suitable candidates.
- The Belk Family: The South’s first family of retail already has 5% of the team. Considering they sold the department store chain in 2015 for roughly $2.7 billion, they easily have the liquid assets to buy Richardson’s piece.
- Leon Levine: The man who founded Family Dollar in 1959 owns 10% of the team. He sold his chain of stores to Dollar Tree in 2015 for $9.1 billion.
- Steve and Jerry Wordsworth: The brothers who built Meadowbrook Meat Company are the biggest minority shareholders, controlling 16% of the Panthers. They sold MMC to Berkshire Hathaway’s McLane Company in 2012 for an undisclosed amount reported to be in the $10 billion range.
Those are just the folks who already have a seat at the Panthers’ table. There’s plenty of outsiders who could simply plop the money on the table while P-Diddy’s is passing the proverbial hat. Even with the aforementioned Colin Kaepernick, and even with the addition of Stephen Curry, the Kaep-Diddy stew just doesn’t have the spice.
The bottom line works like this. All the money numbers I’ve used in this piece come from Forbes, who also peg Diddy’s net worth at an estimated $820 million. For ownership in the NFL to have a controlling share, a single incoming owner must control at least 30% of the equity of the team, and the amount of allowable debt for a purchase is capped at $250 million.
All these value and net worth numbers are estimates, but to make the math easy, let’s stipulate they are accurate. In September, Forbes valued the Panthers at $2.3 billion. There’s almost always a swelling effect on those valuations when the time comes for an actual sale. From the September valuation, Richardson’s share would be worth $1.104 billion, and given the aforementioned inflative nature of sale prices in the NFL, it’s a safe bet that number is going up, especially considering the people at the table who already have the money.
Even if we dropped the number to the 30% threshold required for an incoming owner, P-Diddy would still need to write a check for $690 million if the value of the Panthers stays at $2.3 billion. I think the price tag to buy Richardson’s share is going to be north of $1 billion, but even if the number doesn’t move from the estimated value, P-Diddy may not be a day late, but surely is some dollars short. While his net worth might be $820 million, that doesn’t mean whenever Diddy peels a couple of $20 bills out of the ATM, the balance on his receipt says $820 million. Instead, net worth is a measure of assets versus liabilities, which means a lot of that $820 million is in non-liquid assets, like real estate/property, businesses, and other entities which aren’t cash.
The NFL has a history of not being interested in entertainers who have name recognition without the cash to back it up. Author Tom Clancy wanted to buy the Minnesota Vikings, but he didn’t have the money, and Zygmunt Wilf did. Jon Bon Jovi came close with his conglomerate to buy the Buffalo Bills for $1.05 billion, then Terry Pegula dropped $1 billion in straight cash with no loans and no “groups.” Sean “P-Diddy” Combs just looks to be the next car in that “Didn’t Have It” train.
If you hadn’t noticed, the NFL through both rules and actions deliberately avoids buyers who need to leverage purchases with loans or extravagantly-constructed ownership groups. Just look at the list of the last five franchise sales. Every one of them involved a multi-billionaire who had the cash to cover the cost of a franchise purchase multiple times over. Another reason for that is you really want owners who have a cash reserve for a rainy day; a league doesn’t stay healthy for long with owners who have to pay for unexpected expenses with their Visa card.
Red Flag #3 – Here Come the Social Justice Warriors
Remember when I asked why is Yahoo pumping this sludge of a story? Here’s the dead give-away:
Standing alone, Combs may not be able to bring that to the table. But he brings some diversity the ownership group lacks, along with a high-profile business persona that is well-known among at least some of the current NFL ownership fraternity.
Allow me to translate. “Diversity” means “this league needs a black owner.” They aren’t shy about that; it gets laid out there in the second paragraph of the original story. The trouble is NFL ownership isn’t an “affirmative action” issue; it’s not about black and white. It’s about green. You either have it or you don’t. There’s plenty of black people in America who have the cash, but they aren’t getting mentioned like Diddy is. That’s because Diddy is the one who said he would bring in Colin Kaepernick to compete for the starting quarterback job.
I’ve already pointed out the obvious media water-carrying for Colin Kaepernick as well as demonstrating why this guy isn’t a viable NFL quarterback anymore. You can doubt my arguments on Kaepernick all you want, but there’s a fact you can’t deny. Even the Canadian Football League has no interest in him. There’s a CFL team which owns the rights to Johnny Manziel, and even went to the trouble to get him certified to play. As recently as last season, another CFL team gave Vince Young a shot at their roster. That means in Canada, where the whole “national anthem” issue doesn’t even come into play, drunks and has-beens get a shot before Kaepernick does.
That should tell you something not only about Kaepernick the football player, but about what a train-wreck of an owner P-Diddy would be.
Red Flag #4 – That Pesky Grievance
Frankly, this might be my favorite part of this story. The blow-hacks at Yahoo can’t bypass the money problem, and they openly admit the “social justice warrior” aspect of this scheme. But it’s soooo priceless that they try to sell the idea Kaepernick’s grievance against the NFL owners doesn’t lay a complete frost-job on any ownership bid which involves the former quarterback.
It remains to be seen what impact that could have on any ownership efforts. For now, the Kaepernick grievance and his hopeful involvement in a Panthers ownership group appear to be running parallel tracks. One source close to Kaepernick said there are no plans to drop the grievance or let it be influenced by the quest to buy the Panthers. Time will tell whether one of those things ends up influencing the other in the coming weeks or months.
“Parallel tracks” my ass…Let’s go back to the old “Mr. Rogers’ Neighborhood” where the word for today is “mutually exclusive.” Kaepernick can either drag the NFL owners into a legal proceeding while you are calling them colluding racists for conspiring to keep his silly afro on the unemployment line OR he can get them to vote for his entrance into one of the most exclusive clubs on earth. The only people who think both those things can happen honestly believe there is a prince in Nigeria who will put $50 million in their bank account if they just send him their social security number.
The funniest part is even if Kaep and Diddy found that prince, and he really had $50 million for them, it doesn’t come even close to bridging their cash gap.
Red Flag #5 – Robert Kraft Thinks This Is A Good Idea
The only reason this is a “red flag” is because while Kraft is on to something here, he probably hasn’t the foggiest notion why.
“I’m a big fan of Diddy,” Kraft said. “You ask him. I’m a big fan of his. … He’s a good businessman. He’s a very good businessman and I have a lot of respect for Diddy.”
There’s regular readers of this blog who have accused me of being a Robert Kraft basher. I would say all I do is point out this guy has a long history saying and doing some incredibly dumb things, but this isn’t one of them. For once, I actually agree with Boston Bobby Blowhard.
Think about it. If the NFL had one franchise where it could stockpile all of it’s dim-bulbs like Kaepernick, lying race-baiters like Michael Bennett, and general malcontents like Eli Apple, there’s very little doubt that franchise becomes a rival with the Browns for complete ineptitude and rampant dysfunction. In other words, you can encapsulate the cancer which is growing on the NFL, the whole world will be able to see that failed model in action, nature will take it’s course, and the NFL can get back to fixing the crap product it is putting on the field.
Think about it some more. You can’t tell me that it’s a coincidence that the 49ers were a disaster while they were enduring Kaepernick’s non-sense, and once they got rid of him and the soft-brains who tolerated it, the fortunes of that team changed direction. You can’t tell me it’s a coincidence the Seahawks went from a Super Bowl contender to a dumpster-fire when they starting doing crap like nominating a guy who was proven to be lying about being racially-profiled by the Las Vegas police as their “Man of the Year.” There’s a reason why that team has star players openly campaigning for jobs on other teams.
In short, instead of letting these jerk-offs sink the NFL’s collective ship, give them their own “Ship of Fools” to run into the rocks. You know that’s exactly what would happen to franchise whose prospective owner wants to bring in a used-up, mediocre-at-best quarterback to compete with an MVP-caliber star.
But it isn’t going to happen unless that Nigerian prince ups the ante to about a billion.
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On an NFL ownership related note, you have to just love that the Gruden rumors continue to run rampant.
With Tampa holding on to Coetter for another year, ESPN, the source for all things untrue, leaked that Baby Davis is willing to offer Gruden part ownership in the Raiders to get him to coach them again.
Haven’t seen yet whether Vegas has posted any odds of him taking the gig.
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I wonder how Jack Del Rio feels about all of this?
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Like anyone cares about that.
If he could speak in complete sentences, maybe a booth would take him.
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Jack Del Rio is now available for any team you might like…
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