Arsenal and Stan Kroenke excluded from £750m opportunity as rival bids imminent

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Alongside Arsenal, Stan Kroenke owns franchises in the NFL, NBA, MLS and many more besides, but he won’t get the opportunity to invest in one of the biggest auctions in sports business history.

His teams, alongside a multi-billion dollar property empire, are worth around £16bn in total. That makes Kroenke Sports & Entertainment (KSE) the most valuable sports portfolio in the world.

Arsenal – where KSE heir apparent Josh Kroenke is now the main decision-maker – represent about £2.5bn of that total, though the valuation figure varies depending on whether you ask an investment bull or bear.

Either way, however, there is a broad consensus that Stan Kroenke has already achieved a healthy markup on the circa £800m he has spent to acquire 100 per cent of the club.

On top of that, the 78-year-old Missouri-born billionaire has also lent the club close to £400m. And that is £400m that he is unlikely to ever see repaid, because Arsenal – like nearly every club in Europe – aren’t consistently profitable. Even when they are, that cash is reinvested in the club.

Instead, it appears as though the long-term masterplan is to continue to grow the Arsenal brand globally, optimise costs, increase enterprise value, and eventually sell the club to another investor for a huge profit. £5bn, £6bn, £7bn? Who knows.

• READ MORE: What would need to happen before Stan Kroenke would consider selling Arsenal?

Stan Kroenke’s investment masterplan at Arsenal

You’ll notice that football isn’t mentioned above. That is because, while a Premier League title would be a welcome bonus for Kroenke, it is of secondary concern relative to a return on investment. The difference between finishing 1st and 2nd in the Premier League is negligible in terms of prize money. It wouldn’t cover a first-team player’s wages for even a year.

There would be a commercial boom too, yes, but a single season of glory on the pitch wouldn’t move the needle significantly in terms of enterprise value.

But at Kroenke’s other franchises – especially the Denver Nuggets, LA Rams, Colorado Avalanche and Colorado Rapids – the setup is different.

Honours won by KSE-owned teams

In the NBA, for example, the Denver Nuggets are virtually guaranteed to generate an eight-figure profit every season thanks to a neatly engineered system of a salary cap, luxury tax, revenue sharing and the absence of promotion, relegation and access to or absence from continental competition.

And now, the NBA is looking to expand into Europe.

Kroenke cannot buy NBA Europe franchise

Several Premier League and European football clubs have been approached about the possibility of launching an expansion franchise ahead of a 2027 launch.

London – where the London Lions’ plans for new 15,000-seat basketball venue were recently approved – is a major target market for the NBA, who are expected to ask would-be owners for up to £750m to participate. Manchester City and Paris Saint-Germain are understood to be interested.

Arsenal, however, will be excluded from NBA Europe because the organisation’s rules state that owners cannot control more than one basketball team simultaneously.

The same is true for Chelsea, whose co-owners Mark Walter and Todd Boehly are set to take over the LA Lakers in a world-record £7.5bn deal.

For bedrock Arsenal fans who see their club as a community institution rooted in football, that might be a relief. It would, after all, be a nakedly commercial move.

• READ MORE: Arsenal’s masterplan to boost matchday and commercial income

There is no doubt that there will be pushback from fanbases of teams who do sign up, especially in England where the multi-sport model is less common than in mainland Europe.

There is no doubt, however, that NBA Europe will be monumentally lucrative if executed well.

For teams in Spain, Turkey, Germany and Portugal, for example, where the multi-sport model is far more common, there may be less bucking from some supporters.

As for Kroenke, he is no stranger to upsetting the established order: See: the European Super League plot in 2021 and his 2016 decision relocate his Rams NFL franchise from St Louis to Los Angeles.

If he was able to invest in NBA Europe, would he? Who knows, but there are many owners of elite European clubs who see leveraging the international brands of their teams to expand outside of football and open up new revenue streams, audiences and profit.