US basketball’s elite NBA is engaged in talks with a number of international stakeholders, including prominent European soccer teams, regarding the formation of a new European basketball competition in partnership with global governing body FIBA.
The reigning champions of English and French soccer, Manchester City and Paris Saint-Germain (PSG) respectively, have both been contacted by the NBA over entry into this new competition, with PSG owners Qatar Sports Investments (QSI) stating it is interested in the project.
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In addition, prospective investors for a team based in the UK capital London have also been in talks with the NBA, while the German cities of Berlin and Munich have also been considered, in part due to the failure of the NBA to agree a joint-venture partnership with European basketball’s existing elite-tier EuroLeague.
Plans for the competition, which could have at least eight and as many as 10 franchises worth up to $500 million each, are being mulled over by the league’s team owners ahead of the next NBA owners meeting, which will take place later this week in New York City.
Initially, the NBA would retain 50% equity in those franchises, which it is seeking to sell to investors outside the league’s current ownership makeup, for example, QSI or other sovereign wealth funds, or indeed existing European multi-sport or basketball clubs.
The NBA also regularly stages annual fixtures in Europe during the regular season, most recently when the San Antonio Spurs and Indiana Pacers played out a series in the French capital of Paris that drew record viewership.
Despite the lack of an official accord with the EuroLeague as yet, it would seem that as many as four of the EuroLeague’s best teams could participate, meaning high-profile sides from major European capitals – such as Spain’s Real Madrid – could feature, a factor that would immediately boost the league’s pulling power and credibility, as well as its revenue potential.
While this would further stratify European basketball with a second semi-closed elite competition (just as the EuroLeague already is), it could also escalate what seems to be a global basketball real estate arms race between the currently dominant NBA, and a consortium of investors led by Saudi Arabia’s PIF that has assembled $5 billion to rival the US league.
The Financial Times publication revealed in February that the competition would feature six men’s and six women’s teams, each competing across eight global host locations, with Macau and Singapore already in contention and more (primarily European) locations being targeted.
Other investors beyond the PIF, according to reports, include the Quiet Capital private equity firm, noted tech investor Byron Deeter, Skype co-founder Geoff Prentice, and perhaps most curiously Maverick Carter, the business partner of NBA icon LeBron James.
Swiss banking giant UBS will reportedly serve as an advisor to the project also.
Should it come to fruition, this project could have a similar effect on basketball that the PIF’s other major sports league investment, LIV Golf, had on both that sport in general, and on the rival PGA Tour specifically.
