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(Bloomberg) — NBA Commissioner Adam Silver said the league will turn to expansion, possibly overseas, after it completes a new round of TV rights deals.
“At some point we’d like to look outside the United States in addition to Canada, this may not be the right moment to do that but I’m thinking long-term as well,” Silver said at a press conference in Boston Thursday before the start of the NBA Finals.
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Las Vegas and Seattle are both looked at as favorites for new NBA franchises. Mexico City is also considered a contender. The only foreign team presently is the Toronto Raptors.
The league created a three-step plan involving a new collective bargaining agreement with its players’ union, new TV deals and then a look at expansion, Silver said. The league and its players’ association agreed to a new contract last year.
The NBA is well into negotiations for renewal of its broadcast rights. While discussions with Warner Bros. Discovery Inc. continue, the league is expected to renew with Walt Disney Co.’s ESPN and add two new partners in Comcast Corp. and Amazon.com Inc.
Bloomberg News reported last month that the new deals could generate $76 billion for the league over 11 years. The current contracts expire after the 2024-25 season.
If Warner Bros. isn’t able to match another bidder or create a fourth package with the league, it would mean the end for the company’s 40-year relationship with the NBA.
The league has a number of suiters for teams, including some of it’s current and former players like LeBron James. Current NBA rules prevent active players from buying into teams, but if James retires, he would be eligible. The Lakers’ star currently has an interest in Fenway Sports Group, which owns the Boston Red Sox, Pittsburgh Penguins and Liverpool FC.
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Another big name interested in ownership is Shaquille O’Neal, who told Bloomberg earlier this year that he’d buy “whatever team is available.”
The last three NBA teams sold each went for $3 billion or more.
Silver said the league isn’t currently considering allowing institutional investors to be controlling owners of franchises.
“We think it’s still very important that there be individuals and ultimately a singular governor who has ultimate decision making for a team,” he said.
Under current rules, teams can sell up to 30% of its club to private equity investors, but a single firm may own no more than 20% of a franchise.
“Historically, we were concerned that they would be quickly looking to flip their investments, we haven’t seen that,” Silver said. “The investment community is looking at sports teams, particularly premium sports teams as an investment category.”
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