Josh Harris Group Has Tentative Deal to Buy Commanders from Daniel Snyder

The Washington Post

13:51 JST, April 14, 2023

An investment group led by Josh Harris reached a preliminary agreement to purchase the Washington Commanders from owner Daniel Snyder, according to three people with direct knowledge of the sale process.

Harris’s group would buy the team from Snyder for $6.05 billion if the deal is completed, according to one of those people. Two people characterized the deal as an agreement in principle; Harris’s group is “nearing a deal” but it is “not yet final,” according to the third person.

The agreement is unsigned and has not yet been submitted to the NFL or its finance committee, three people said. It is nonexclusive and thus does not bar other bidders from continuing to negotiate. Canadian commercial real estate developer and private equity executive Steve Apostolopoulos also has bid on the team, and according to a fourth person with knowledge of the process, his negotiations with Snyder remain active. Apostolopoulos’s group submitted a $6 billion bid for the franchise, that person said, and earlier toured the team’s facilities.

A completed deal would have to be ratified by the NFL’s team owners, who are scheduled to meet next month in Minneapolis. If approved, a sale would end Snyder’s turbulent ownership of the franchise he bought in 1999 from the Jack Kent Cooke estate for $800 million.

The sale price would be a record for an NFL team, surpassing the $4.65 billion a group led by Walmart heir Rob Walton paid last year to purchase the Denver Broncos from the Pat Bowlen Trust.

The Harris group declined to comment through a spokesman. The Commanders and the NFL also declined to comment.

Both Harris, the owner of the NBA’s Philadelphia 76ers and the NHL’s New Jersey Devils, and top investor Mitchell Rales, a businessman and philanthropist based in Potomac, Md., have roots in the D.C. area. Former NBA great Earvin “Magic” Johnson also is an investor in Harris’s group.

The bidders for the Commanders also included Tilman Fertitta, the owner of the NBA’s Houston Rockets. Fertitta said in a televised interview Wednesday with CNBC that he bid $5.6 billion for the team and would not raise that offer. On Wednesday, a person familiar with the process said that Amazon founder Jeff Bezos, who had hired a New York investment firm to help him evaluate a potential bid, had no immediate plans to submit one.

It is not immediately clear whether an issue related to the indemnification of Snyder against future legal liability and costs has been resolved. Three people with direct knowledge of the league’s inner workings and the views of the owners said in February that Snyder was seeking such indemnification from a buyer or from the league and other owners. Snyder threatened to sue the league if he wasn’t indemnified, according to those people, who said the other owners were angered by the demand. They described the issue as a potential complication to the completion of the sale. The Commanders said at the time that such depictions were inaccurate.

The deal must be vetted by the owners on the NFL’s finance committee and then put to a ratification vote by the owners. In the case of the Broncos sale last year, that process took approximately two months, and investors were added to the incoming ownership group even after the initial deal was struck. At least 24 of the 32 owners leaguewide must approve the sale.

“It’s really a ways away,” a person familiar with the NFL’s inner workings and the views of the owners said Thursday. “It will really come down to the fine print in the purchase agreement and the indemnification aspect.”

The NFL, the finance committee and the owners have a positive view of Harris and his main investors, that person said. The league and finance committee have not yet reviewed the structure of the pending deal.

If the sale is approved, Harris and his business partners will face a variety of issues ranging from repairing the franchise’s relationship with its fan base to reviving efforts to secure funding and identify a site in the region for a new stadium to replace FedEx Field in Landover, Md. Many within the NFL and throughout the region would like to see the team return to the District at the RFK Stadium site.

The new owners also would have to address the status of the franchise’s leadership, including team president Jason Wright and Coach Ron Rivera.

Harris grew up in Chevy Chase and attended the Field School in Northwest Washington. He was the co-founder of Apollo Global Management and is a general partner of the English Premier League’s Crystal Palace Football Club. Harris has an estimated net worth of $6 billion, according to Forbes. He is a limited partner in the NFL’s Pittsburgh Steelers and would have to sell that stake to buy the Commanders. He made a failed bid last year to buy the Broncos.

Rales, the co-founder of the Danaher Corporation, has a net worth estimated by Forbes at $5.7 billion. He is also well known in the art world as a collector of modern and contemporary art, which is displayed at Glenstone, a private art museum he founded in Potomac that is curated by his wife, art historian Emily Wei Rales.

The Commanders announced in November that Snyder and his wife, Tanya, the team’s co-CEO, hired Bank of America Securities to consider potential transactions for the franchise. The team had not specified whether the Snyders would sell all or part of the franchise.

Bezos hired the prominent investment firm Allen & Company to help him evaluate a potential bid on the Commanders, two people familiar with the situation previously said. Other NFL owners have said they would like to see Bezos own a franchise. That still could happen if the Seattle Seahawks are put up for sale, as is expected. Amazon Prime carries the NFL’s package of Thursday night games.

Bezos, who owns The Washington Post, has a net worth estimated by Forbes at $125.5 billion, making him the world’s third-wealthiest person. Daniel Snyder “rebuffed every effort” by Bezos to move forward toward purchasing the team, a person familiar with the process said in February, adding that Snyder was acting “out of spite” because of his disdain for The Post and its coverage of him and his team.

It’s unclear whether Snyder’s decision not to sell to Bezos and the failure to secure a price closer to $7 billion might present any issues during the owners’ ratification process. The deal for the Commanders comes with attorney Mary Jo White conducting the league’s second investigation of Snyder and the team’s workplace. The NFL has said White’s findings will be released publicly.

“Today marks the end of a long, difficult chapter for all employees and fans of the Washington football organization,” attorneys Lisa Banks and Debra Katz, who represent more than 40 former Commanders employees, said in a statement Thursday. “We are proud of our many clients who made this moment possible – the brave women and men who came forward repeatedly and at great personal risk to expose the decades of sexual harassment and financial wrongdoing at the team. Their determination and perseverance forced this sale to happen.”

Snyder has declined to be interviewed by White for the investigation, three people with direct knowledge of the league’s inner workings said recently. White was expected to make at least one more attempt before completing her investigation, according to one of those people.

“We want to welcome the new owners and hope a new chapter can truly begin at the organization,” Banks and Katz said in their statement. “We expect that the NFL now understands that such an abusive workplace for women is unacceptable. The NFL must be more vigilant and must ensure that owners are held to the same standards as all employers; sexual harassment is illegal and must not be tolerated.”

Indianapolis Colts owner Jim Irsay said in October that the owners should give serious consideration to taking a vote to remove Snyder from ownership of his franchise. Multiple owners told The Post in September that they believed strong consideration would be given to attempting to oust Snyder from the ownership ranks, either by convincing him to sell or by voting to remove him.

Following a previous investigation of the team’s workplace by attorney Beth Wilkinson, the NFL announced in July 2021 that the team had been fined $10 million and that Tanya Snyder would assume responsibility of the franchise’s day-to-day operations for an unspecified period.

The Post reported in 2020 that the team paid a former employee $1.6 million as part of a confidential settlement in 2009 after she accused Daniel Snyder of sexual misconduct. Snyder denied the woman’s allegations, and a team investigation accused her of fabricating her claims as part of an extortion attempt. Snyder and the team eventually agreed to pay her a seven-figure sum as part of a settlement in which she agreed not to sue or publicly disclose her allegations.

White’s investigation was launched in February 2022 after Tiffani Johnston, a former cheerleader and marketing manager for the team, said at a congressional roundtable that Snyder had harassed her at a team dinner, putting his hand on her thigh and pressing her toward his limo. Snyder denied the accusations, calling the allegations made directly against him “outright lies.”

Federal authorities in the Eastern District of Virginia are also investigating the team and Snyder. The federal investigation includes multiple agencies and is focused on allegations of financial improprieties involving the team, according to multiple people familiar with the situation.

The allegations of financial improprieties originally surfaced as part of the Democratic-led investigation of the team’s workplace by the House Committee on Oversight and Reform. The Commanders have denied any financial wrongdoing.

The office of Karl A. Racine, a Democrat who was then the District’s attorney general, filed a consumer protection lawsuit in November against the Commanders, Snyder, the NFL and Commissioner Roger Goodell, accusing them of colluding to deceive and mislead customers about an investigation of the team’s workplace to maintain its fan base in pursuit of revenue. The team and the NFL denied the allegations. A spokesperson from the office of Racine’s successor, D.C. Attorney General Brian L. Schwalb (D), said, “OAG’s lawsuit against the Washington Commanders, Dan Snyder, the NFL, and Roger Goodell is ongoing and is unaffected by the sale of the team.”

Racine’s office filed a second lawsuit that month against the Commanders regarding refundable deposits that the team allegedly did not return to season ticket holders from D.C. Schwalb on Monday announced a settlement of that lawsuit, by which the Commanders agreed to pay a $425,000 fine to the District and refund more than $200,000 in deposits to Washington ticket holders. The Commanders denied the District’s claims in the settlement.

Brian E. Frosh, a Democrat who was then Maryland’s attorney general, announced in November that his office’s consumer protection division reached a settlement with the Commanders over allegations that the team withheld security deposits from ticket holders. The team paid a $250,000 fine under a settlement in which it did not admit to the allegations. The settlement called for the Commanders to refund all security deposits that had not been returned to consumers.

The office of Virginia Attorney General Jason S. Miyares (R) also is investigating allegations of financial improprieties involving the Commanders. A spokesperson for Miyares declined to comment on Thursday’s news because the investigation is ongoing.