Considerations for Professional Sports Teams Contemplating Going Public
Green, Bryan A.
Garrett, Jorge E. Leal
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The recent and lingering recession has put a significant financial strain on many industries and businesses in the United States, especially professional sports teams. While professional sports teams may not be the most profitable investment to begin with, owners must still keep them as financially sound as possible. This is especially true in these tough financial times. Going public provides the opportunity to raise capital rapidly and thus cannot be overlooked. Having sufficient capital resources is not just important from a business aspect, but is also necessary from a competitive standpoint. As a result, many teams must explore every avenue to either cut costs or raise additional capital, including going public. Nevertheless, going public entails many challenges and implications. Additional factors, such as SEC rules and regulations, potential investors, and the element of control, must all be considered prior to the initial public offering. In the end, going public could become a valuable tool for professional sports teams to ride out the recession and become more financially stable.