NBA seeks ownership groups for European basketball league

The NBA is looking to Europe for its next stage of growth.

The league announced Monday that it will move forward with a joint exploration of a new men’s professional league in Europe, in partnership with the International Basketball Federation, also known as FIBA. The NBA said it plans to begin the process of working with potential teams and ownership groups in January.

The value of the franchises could exceed $1 billion, according to a person familiar with the matter who requested anonymity to discuss details that have not yet been made public.

During the NBA Cup last week in Las Vegas, NBA Commissioner Adam Silver said JPMorgan and the Raine Group have been actively meeting with interested parties in Europe and that there is significant “positive interest” in moving forward.

Bankers have met with at least 70 potential investors, sources told CNBC. Discussions began about a year and a half ago. The goal is to accept non-binding offers next month and vote to green-light the league at the board of governors meeting in March, sources said.

NBA Deputy Commissioner Mark Tatum previously said the league was considering possible ownership by sovereign wealth funds. The NBA also engages current owners of European football clubs.

The league first announced last March that it was exploring a men’s basketball league in Europe.

“Our conversations with various stakeholders in Europe have reinforced our belief that there is a huge opportunity around the creation of a new league on the continent,” Silver said in a statement Monday. “Together with FIBA, we look forward to engaging potential clubs and ownership groups who share our vision of the game’s potential in Europe.”

The NBA said it would also provide financial support and resources to European basketball. It plans to invest in national leagues and the development of existing FIBA ​​programs to create a pipeline of coaches, players and referees, according to Monday’s statement.

The NBA estimates there are 270 million potential basketball fans in Europe, calling it an “untapped market.” This year, on opening night, the NBA had 71 players born in Europe. Some of the league’s biggest stars – Victor Wembanyama, Giannis Antetokounmpo, Nikola Jokić and Luka Dončić – hail from Europe.

The NBA said basketball is the fastest growing sport in Europe and the No. 2 sport behind football. The league said the timing was perfect, as last season was the NBA’s most-watched on the league’s social and digital channels.

The NBA believes the current European basketball market is undervalued and lacks teams in flagship cities, according to a source familiar with the matter. Two-thirds of teams in the established EuroLeague are losing money, according to the Wall Street Journal.

The NBA is reportedly looking to bring teams to Berlin, Paris, Rome and London, according to the source. It is also considering Spain, Turkey and Greece.

If the NBA moves forward with the league, it could begin bringing exhibition teams to play in Europe in the short term. Eventually, NBA teams could even compete against European teams in a cup or all-star type event.

FIBA Secretary General Andreas Zagklis said the announcement was great news for European basketball and its fans.

“The project is designed to improve the sustainability of the entire European basketball ecosystem, including players, clubs, leagues and national federations, generating a ripple effect that will greatly benefit basketball fans across Europe,” he said in a statement.

The NBA has just completed the fifth season of its African League, also in partnership with FIBA. The league said its attendance, merchandise sales and social engagement increased each year.

Correction: This story has been updated to reflect the teams’ potential franchise value.