The Sports Billionaires
By Klaus Kneale, Forbes.com
December 4, 2007
Owning a sports team can be a frustrating proposition. Expensive players get in trouble off the field. Coaches' egos need constant soothing. And fans are fleeting – especially if their team loses as ticket prices rise.
But for some billionaires, the allure of the victory – and the chance their team will soar in value – makes all the player misbehavior, years of rebuilding and negative press worth it.
Take Robert Kraft, the owner of the National Football League's darling New England Patriots. When Kraft bought the team in 1994 for a then-record $172 million, the team was a faltering money-loser, winning less than half its games since 1959, the year it started. Kraft transformed them into one of the most valuable sports franchises in the world, these days worth $1.2 billion.
On the arm of star quarterback Tom Brady, the Pats won three Super Bowls and have the best record in the league this season. The success of the team made Kraft a billionaire. The majority of his $1.4 billion fortune is wrapped up in the Patriots; the remainder comes from real estate and other investments, as well as the New England Revolution Major League Soccer team.
Dallas Cowboys owner Jerry Jones struck it rich in natural gas in the 1970s. He bought the then-junky Cowboys for $158 million in 1989. Led by quarterback Troy Aikman and running back Emmitt Smith, the team won three Super Bowls in the 1990s. Today they're worth $1.5 billion before debt and sit atop the National Football Conference East, led by star quarterback Tony Romo.
Nearly all of Jones' $1.5 billion net worth is derived from the Cowboys; he recently sold $300 million worth of his personal real estate to help pay for the current construction of a new $1 billion Cowboys Stadium.
Vanity investors dominate Europe, buying soccer teams to own soccer teams, but making their fortunes elsewhere. Iceland's Bjorgolfur Gudmundsson made his $1.2 billion fortune in shipping, banking, real estate and beer brewing before buying soccer's West Ham United last November. Silvio Berlusconi, Italy's richest man, built his $11.8 billion fortune through media investment; he became president of soccer's legendary squad A.C. Milan in 1986.
But the king of them all has to be Roman Abramovich, the 41-year-old Russian oil guru who spent a tiny fraction of his $18.7 billion net worth to scoop up debt-heavy U.K. soccer giant Chelsea in 2003. Once reviled for his moves, he grew on fans after immediately spending more than $170 million on new players. The squad's 2004-2005 season is considered its most successful season ever, and the team's value is up 58 percent since Abramovich bought the team – despite not winning a championship or building a new stadium.
And some owners were once players. Detroit Tigers owner Michael Ilitch left his dreams of playing pro baseball behind after an injury forced him to hang up his cleats in the minor leagues. He spent decades building his Little Caesar's Pizza into one of the largest chains in America, using the proceeds to buy up his hometown teams. Ilitch bought hockey's Detroit Red Wings in 1982 for $8 million, today worth $293 million. He bought the Tigers for $82 million 10 years later; they're now worth more than $350 million.
Winning isn't always everything. Ask Charles Dolan, owner of the NBA's New York Knicks. Last year, Dolan, who owns the Knicks through cable giant, paid his players a league-high $118 million; they put up the second-worst record in the league. No problem: The team is worth $592 million, the highest in the NBA.
The top five:
Updated on Tuesday, Dec 4, 2007 11:33 pm, EST