Walmart has arrived in the NFL.
Rob Walton, the eldest son of Walmart founder Sam Walton, is on the verge of becoming the new owner of the Denver Broncos after the team announced Tuesday night that it had reached a deal to purchase him, his daughter Carrie Walton-Penner and himself has son-in-law, Greg Penner.
Financial terms weren’t immediately disclosed, but Denver-based 9News reported that Walton will pay $4.65 billion for the franchise, more than double the last retail price for an NFL team. The $4.65 billion asking price would also set a record for an American sports franchise.
“We are excited to move forward with the Denver Broncos purchase,” Walton said in a statement released by the team. “…Having lived and worked in Colorado, we have always admired the Broncos. Our excitement has only grown as we have learned more about the Broncos team, staff and country over the past few months.”
Walton, 77, was chairman of Walmart from 1992 to 2015 and has a net worth that Forbes estimates at $65 billion, which puts him in the top 20 richest people in the world and will make him the richest NFL owner by far .
Before the ownership transfer becomes official, Walton’s offer must first be reviewed by the NFL and the Ownership Group Finance Committee, and then approved by a three-quarters majority of the other 31 owners. Not only does Walton have the net worth to provide a clean financial package for the sale, but he’s also related by marriage to Los Angeles Rams owner Stan Kroenke. Kroenke is married to Walton’s cousin, Ann Walton-Kroenke, and also owns two Denver sports franchises in the NBA’s Nuggets and the NHL’s Avalanche.
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While Walton will be the controlling owner of the Broncos once the deal closes, the exact makeup of his investment group is yet to be known, though he made a significant announcement beyond Penner, who succeeded him as Walmart’s chairman in 2015 and continues to serve in that role.
Mellody Hobson, co-CEO of Ariel Investments and chairman of Starbucks, is joining the ownership group, Walton said in the press release announcing the deal.
Hobson, who became the first black woman to chair an S&P 500 company when she took on that role at Starbucks, is a key figure, in part because the NFL has made it clear that it seeks greater diversity in its ownership. But among the key remaining questions are whether the Walton-Benner group will have stronger minority representation and what sort of operational role Hobson and others will assume.
Pittsburgh Steelers owner Art Rooney II said at the league’s annual spring meetings in March that he believed “several” of the bidding groups were representatives of minority groups, and NFL Commissioner Roger Goodell said at those same meetings that the league considered this a priority consider .
However, the sale of the Broncos will be handled by trustees of the Patrick D. Bowlen Trust, who have a fiduciary responsibility to the seven beneficiaries – the late Bowlen’s children, who collectively own 78% of the team – to accept the offer, which served their best interests . Bowlen bought the team in 1984 for around $78 million and owned it until his death in 2019, though he ceded control of the team to CEO Joe Ellis in 2014 amid his battle with Alzheimer’s disease. From there, a maze of court proceedings ensued before the franchise was officially put up for sale on February 1st.
Since then, the process has evolved rapidly, especially given the complexity of a multi-billion dollar acquisition. The finalists submitted bids for the second round Monday afternoon for the franchise and its agents to consider. Just over 24 hours later, the Walton bum bid was selected.
“I appreciate the collaboration of our football leadership, leadership team and staff at both the UCHealth Training Center and Empower Field at Mile High over the past few months and years,” Ellis said in a statement. “We would also like to acknowledge the work of Allen & Company and Proskauer Rose for guiding us through this process in a timely and efficient manner.
“While this purchase and sale agreement is subject to approval by the NFL’s Finance Committee and the league’s owners, today marks a significant step toward an exciting new chapter in Broncos history.”
Not only has Ellis been CEO since 2014 and has been with the franchise for 27 years, he has also been one of three trustees of the Bowlen Trust. Allen & Company oversaw the sale process as the trust’s financial advisor and Proskauer Rose LLP, led by Joe Leccese, provided legal advice.
Other potential contenders for small stakes in the ownership group include franchise luminaries John Elway and Peyton Manning. Elway, the two-time Super Bowl champion who served as team leader after retiring from playing, has expressed interest in becoming part of an ownership group.
Neither was publicly tied to an ownership offer like NBA Hall of Famer Magic Johnson was to the group of Philadelphia 76ers and New Jersey Devils owner Josh Harris. Other finalists for the franchise included Mat Ishbia, former Michigan State basketball player and President and CEO of United Wholesale Mortgage, and a group led by Jose Feliciano and Behdad Eghbali, co-founders of Clearlake Capital, and Todd Boehly and others.
Whatever the form of the investment group, despite the booming value and acquisition cost of an NFL franchise, Walton had the financial resources to win the auction all by himself.
Just four years ago, David Tepper bought the Carolina Panthers for $2.275 billion. Four years earlier, in 2014, the Buffalo Bills were sold to Kim and Terry Pegula for $1.4 billion.
Tepper, who Forbes estimates is worth more than $16 billion, held the title of the richest NFL owner but is roughly quadrupled by Walton. Walton is set to become the second-richest owner in esports, behind only Los Angeles Clippers owner and former Microsoft CEO Steve Ballmer, whose worth is estimated at about $89 billion, according to Forbes.