Free kick Posted September 10, 2008 Share Posted September 10, 2008 http://www.forbes.com/business/2008/09/09/mls-soccer-beckham-biz-sports-cz_kb_0909mlsvalues.html Link to comment Share on other sites More sharing options...
Richard Posted September 10, 2008 Share Posted September 10, 2008 Impressive, not a bad appreciation on their initial investment... The Toronto FC, which commissioner Garber holds up as the blueprint for the coming expansion teams, is worth $44 million, up four-fold in just three years. The team turned a profit of $2.1 million in its inaugural season last year, when it sold every ticket at 20,500-seat BMO Field. Link to comment Share on other sites More sharing options...
An Observer Posted September 10, 2008 Share Posted September 10, 2008 One interesting point is that it mentions that TFC gets very good local television and sponsorship deals compared to the rest of the league. It begs the question why Garber is claiming that Vancouver and Montreal need to not only have fan support but demonstrate that Canada can provide the commericial support as well. From reading this, the question could be turned on its head and the league should ask the new US franchises whether they can generate the local commercial support needed. Link to comment Share on other sites More sharing options...
Canuck Oranje Posted September 10, 2008 Share Posted September 10, 2008 Adds to the argument that teams from soccer hotbeds like Salt Lake, Columbus, Denver, and Kansas City are likely to act as a financial drag on this league. I don't give too much weight to the values because who will buy, especially when value is tied to success in the local market and the success of other teams? What percentage of each team's equity continues to be owned by MLS? Which leads to the question, just how much value of the Columbus, Kansas City, and Salt Lake teams are tied to simply being part of MLS? Also, just how much of Beckham's salary is accounted for in the Galaxy's team budget and how much is allocated to the parent company for marketing services etc? Bottomline, revenues are still quite low for most teams. At the same time, profits and values can be manipulated. Does investment in this league (in its current form) continue to make sense with a $50 million franchise fee? I suspect we will see some franchise movement in the next few years. Link to comment Share on other sites More sharing options...
Free kick Posted September 10, 2008 Author Share Posted September 10, 2008 quote:Originally posted by An Observer [br From reading this, the question could be turned on its head and the league should ask the new US franchises whether they can generate the local commercial support needed. Yes, I raised that exact point as well in the past. I just dont see the massive corporate support that they talk about in the USA in the games that I saw there. And in Toronto, the initial ticket drive was very much a grassroot ( grassroot fans I mean ) movement moreso than a corporate push. Its as if he's saying that if you are a Cnd applicant, you have to be two times better than the comparable US applicant. Aside from maybe LA, none of the current US clubs even have what Garber was wanting to see from Van and Mtl. Link to comment Share on other sites More sharing options...
Richard Posted September 10, 2008 Share Posted September 10, 2008 ^ Bit like being a woman in the corporate environment, have to be twice as good as a man Link to comment Share on other sites More sharing options...
RustyTWH Posted September 10, 2008 Share Posted September 10, 2008 "Toronto FC spectators topped the league in spending, averaging $15 a game on food, beverages and souvenirs at concession stands" At $12.75 per beer and $90 for a jersey I would have thought that'd be higher. There must be a few spendthrifts out there on whose behalf I am spending. Link to comment Share on other sites More sharing options...
I_AM_CANADIAN Posted September 10, 2008 Share Posted September 10, 2008 I'm sure that the CBC would pick up Whitecaps games, and I bet that Craig Forrest at Sportsnet would love to do commentary for his hometown club. And SRC is already showing Impact games, they'd have no trouble getting on TV. Link to comment Share on other sites More sharing options...
Rujulus Posted September 13, 2008 Share Posted September 13, 2008 quote:Originally posted by Canuck Oranje ... Does investment in this league (in its current form) continue to make sense with a $50 million franchise fee? I suspect we will see some franchise movement in the next few years. A fair question since the assessed value of every team in the league (except LA at $100M) is less than $50M. If these are reasonable valuations, why pay $50M just to get in the door when the fair market value to purchase one of the 12 established franchises ranges from $22-44M, averaging $32M? To sum up the numbers, the article puts the sum of all 13 clubs' value at $485M (this number arrived at by whatever art or wizardry) on total revenues of $166M and total operating losses of $20M/yr. Three of the 13 franchises are currently running operating profits (LA, Toronto & Dallas, at +4.0M, +2.1M & +0.5M respectively); the others are in the red. The valuation, as well as the new franchise fees being discussed, surely both imply belief in healthy growth for the business. You'd be unlikely to want to pay 3x sales for a business that's losing money unless you thought the numbers would improve going forward. Mind you, there may be other arguments in favour of investing in an MLS franchise: a) advertising/publicity/brand-building, it's only money, etc... Link to comment Share on other sites More sharing options...
tmcmurph Posted September 13, 2008 Share Posted September 13, 2008 And how long will LA prosper when Beck's contract is up? This is his second year in the league with 3 more to go. He will be 37 then and while hardly washed up soccer wise will he still have the draw in 3 years that he does now? It is one reason I think both Vancouver and Montreal will get in. I don't see any point for a US based group to buy a franchise when they can get a whole team for less. The only factor would be if MLS won't let new owners move a team. Link to comment Share on other sites More sharing options...
DoyleG Posted September 15, 2008 Share Posted September 15, 2008 quote:Originally posted by tmcmurph It is one reason I think both Vancouver and Montreal will get in. I don't see any point for a US based group to buy a franchise when they can get a whole team for less. The only factor would be if MLS won't let new owners move a team. Of course, that can be holding up any bid of theirs. They would feel that the value of an MLS team isn't worth what they are asking for an expansion fee. Link to comment Share on other sites More sharing options...
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