Appraisal Economics has determined the fair market value of minority interests in a National Basketball Association (NBA) team and an English Premier League (EPL) soccer club. In both cases, we determined the business enterprise value and the corresponding equity value using the subject transaction and guideline transaction methods of the market approach. We reviewed historical transactions of each team’s equity, along with transactions involving comparable teams in the NBA and EPL. Next, we applied the derived market multiples to each subject entity to develop indications of fair market value. To support the market approach, we also considered the valuation multiples indicated in the latest industry research. Our valuation included adjustments to the pro rata values of the subject interests to account for their lack of control and lack of marketability. The gap in valuation multiples applicable to the NBA franchise and the EPL club was consistent with what we see in our work across professional sports, reflecting the higher financial risk involved under the promotion and relegation system used in European football.
Learn more about our experience in the sports industry.