(Reuters) -The owners of the National Football League (NFL) have allowed some private equity firms to buy up to a 10% stake in a team, the NFL said on Tuesday.
Firms initially approved by the NFL include Ares Management (NYSE:), Arctos Partners and Sixth Street in addition to a consortium comprising Blackstone (NYSE:), Carlyle, CVC, Dynasty Equity and Ludis.
The private equity firms plan to invest a total of $12 billion and can invest in up to six NFL teams each, a source familiar with the matter told Reuters.
The NFL’s 32 owners voted at a special league meeting in Eagan, Minnesota.
Investors will need to commit a minimum of $2 billion and can invest in up to six clubs, according to the details of the meeting provided by the league, which also require a minimum hold period of six years.
The league has informed the investment firms and owners that it intends to take a share of the private equity profits on any future sales of ownership stakes, CNBC said in a separate report.
Arctos Partners, a Dallas-based private equity firm, said after the approval that it would be the only firm with an assent to invest in equity across each of the five most popular major North American leagues.
Late last year, Arctos invested in the Aston Martin Formula One team in exchange for a minority shareholding. It had also acquired a minority common equity stake in French football club Paris Saint-Germain.
The NFL is the only major North American sports league that prohibits private equity ownership in a franchise. The NBA, NHL, Major League Baseball and Major League Soccer allow their teams to sell a maximum of 30% of equity to a fund.
The league formed a committee last year to explore changes in its ownership rules. Commissioner Roger Goodell said in March the league was “very close to sort of outlining an approach”, with “a lot of work to do to take that approach into reality”.
The Washington Commanders was the most recent NFL team to be sold, in a record-breaking $6.05-billion deal.
With team valuations on the rise, private equity could turn out to be an alternative avenue for future league franchise sales.