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MLS, Liga MX Explore North American Superleague
Liga Bancomer MX President Enrique Bonilla recently disclosed that the Mexican soccer league has explored a potential merger with Major League Soccer; the 2 leagues entered into a formal partnership (includes Campeones Cup) for the first time, in March ‘18. Bonilla said, “the main idea is that we (the North American clubs) have to grow together to compete. If not, there is only going to be the rich guys in Europe and the rest of the world.” The proposed superleague would include clubs in +/- 50 North American markets.
Howie Long-Short: The idea of a North American superleague is fun to think about, but I certainly don’t expect it to occur. MLS Commissioner Don Garber has long stated that the league’s owners wouldn’t consider promotion/relegation and a top division with 50 teams seems unlikely; with plans for 28 clubs (26 awarded to date), MLS is already structured as the largest top flight soccer league in the world.
Bonilla’s idea may not come to fruition, but the logic behind it is solid; multi-national corporations (think: Coke, Pepsi, GM) and broadcasters would be highly interested in reaching +/- 50 North American markets. Together, MLS and Liga MX would hold the leverage necessary to close the sponsorship and media rights revenue gap with Europe’s top leagues.
MLS and Liga MX would benefit each other in ways beyond dollars and cents. “Liga MX brings the fans (already most watched league in US), purchasing power (Latinos accounted for 68% of U.S. soccer viewership in ’17) and talent. MLS brings the wealth and the infrastructure.”
Fan Marino: On average, MLS clubs grew revenue +7.5% YoY (to $34.6 million) in 2018, despite a slight decline in league attendance (-1.4%, 21,803); that’s because the average ticket revenue per game (see: less comps, slight increase in prices) surged nearly +10%.
Television viewership rose (for a 5th straight season) +5.7% (to 27.8 million) in 2018 (across all windows/networks), on par with the NFL through Week 12 (+5%), but the increase comes with a caveat; 6 of the games that aired on the Fox broadcast network had the benefit of highly watched World Cup Games leading in. It also needs to be noted that linear viewership on both ESPN (-8%) and FS1 (-15%) declined YoY on a stand-alone basis.
According to Forbes, MLS club valuations increased +7.6% YoY (to +/- $240 million), but remove the league’s 3 most recent additions (Atlanta, Minnesota, LAFC) from the calculations and the average valuation only climbed +3.6% (to $232 million). That said, Forbes valuations are historically conservative (see: controlling interest in D.C. United sold at +64% premium). Atlanta is the league’s most valuable franchise, worth an estimated $330 million; they also lead the league in attendance (53,000) this season.
The success the Atlanta organization has had off-the-field has been matched by the team’s performance on it. Atlanta United FC heads into Saturday evening’s (12.8, 8p EST) MLS Cup Final (vs. Portland Timbers) as a heavy favorite (-500). It’ll be fascinating to see if the league’s championship game posts its highest rating of the season. The July 15th contest between Atlanta/Seattle drew 1.59 million viewers in the wake of the FIFA World Cup Final, the most watched MLS match since ’04.
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While we won’t be publishing “hot takes” on LeBron’s relative greatness to Jordan, we will be offering up the most relevant sports related business news, in easily digestible bites, with commentary from both the sports money and sports fanatic perspectives.
We’ll cover publicly traded professional teams & stadiums (MSG, RCI, BATRA, MANU), television networks (DIS, FOXA, CMCSA, CBS, TWX, MSGN), apparel & footwear companies (NKE, UAA, ADDYY, FL, LULU), equipment companies (GOLF, ELY, FIT), ticketing companies (EBAY, LYV) content and facilities providers (CHDN, DVD, ISCA,TRK, LMCA). If it trades on Wall Street, and has a sports angle, it’s in our wheel house.
Howie Long-Short and Fan Marino will be providing their expert opinions on each story. They have slightly different areas of expertise. Fan Marino is a firm believer that the SEC is the premier football conference. Howie Long-Short knows it as the Securities & Exchange Commission. Fan Marino lives and dies with the college selection of 5 star, blue chip recruits. Howie Long-Short spends his days analyzing blue chip stocks. Howie Long-Short knows that Black Monday occurred on October 19th, 1987. Fan Marino swears it happens every January after Week 17. You get the point.