MERCER CAPITAL PROFESSIONAL SPORTS

Transcription

1 MERCER CAPITAL PROFESSIONAL SPORTS

2 MERCER CAPITAL Mercer Capital is a national valuation and financial advisory firm. Clients include private and public companies, financial institutions, high-net worth families, and private equity/hedge funds. Mercer Capital is an employee-owned business valuation and financial advisory firm serving a diverse and international client base. Business valuation and financial advisory services include ESOP and ERISA valuation services, gift and estate tax valuation, valuation for financial statement reporting purposes, M&A advisory, transaction fairness opinions, and litigation support. Clients range from public to private, from smaller companies to large multi-nationals in a broad range of industries as well as numerous governmental agencies. In a typical year, we complete approximately 400 engagements, many of which include the valuation of multiple entities. Our analysts hold a variety of designations including: Accredited Senior Appraiser (ASA) from the American Society of Appraisers Chartered Financial Analyst (CFA) from the CFA Institute Accredited in Business Valuation (ABV) from the American Institute of Certified Public Accountants Certified Public Accountant (CPA) from the American Institute of Certified Public Accountants Certified Business Appraiser (CBA) from the Institute of Business Appraisers Certified in Financial Forensics (CFF) from the American Institute of Certified Public Accountants Member of the Royal Institution of Chartered Surveyors (MRICS) Mercer Capital s is a thought-leader in the valuation profession. Our senior professionals have authored books and written extensively in a variety of publications and are frequent speakers at regional and national meetings of professional societies.

3 MERCER CAPITAL Mercer Capital provides operating companies and financial institutions in a variety of industry sectors with corporate valuation, financial reporting valuation, transaction advisory, litigation support, and related services. Operating company industry expertise includes: Agribusiness Construction & Building Materials Distribution Energy Food and Beverage Healthcare Hospitality Manufacturing Media and Entertainment Mining Professional Services Real Estate Retail Sports Franchises Technology Telecommunications Transportation Veterinary Practices Financial institution industry expertise includes: Asset Management Depository Institutions Business Development Companies Financial Technology Hedge Funds Insurance Private Equity Specialty Finance & Real Estate Companies

4 MERCER CAPITAL PROFESSIONAL SPORTS

5 PROFESSIONAL SPORTS Overview We are one of the leaders in sports valuation and related stadium advisory in the country and have considerable interaction and experience with management of the various leagues. In a sports industry market that has become increasingly competitive in recent years, Mercer Capital s team capabilities in valuation, intangible assets, stadium issues and legal consulting are unsurpassed. We have the depth of knowledge necessary to assist in developing industry best practices. This knowledge relates not only to the underlying economics to the sports business, which include its escalating cost structure, but most importantly, the future revenue-enhancing aspects of sports that are the key to future success. We have the capability to coordinate and help provide a complete package of services, including: Valuations (M&A oriented, tax driven, shareholder buyouts, and litigation) Fairness Opinions Buy Side Planning Due diligence services Stadium lease consulting New and existing Legal transaction consulting Tax Advisory Other Services This knowledge base has been built from the continuing services, engagements and relationships that our team s principals have participated in over the years.

6 FRANCHISE VALUATION PROCESS When considering the value of a major pro sports franchise, the buyer(s) and seller(s) will consider, among other things, the outlook for the league, the economics of the team, local economics, national revenue streams, player contract rights, the inclusion of other non-team related assets (such as stadium rights, media rights, real estate, etc.), and the valuation of the relative assets. In this case it would include the following: Understanding and consideration of assets being sold Consideration and collaboration on various strategic options including: Due diligence, research and risk analysis of various existing and potential revenue streams; Valuation impact of current and potential future media rights Cost structure including current player contract terms and expense profile Optionality evaluation of potential future impact of current or potential new stadium deal with the a state government agency Potential tax issues related to a buyer Forecasting and modeling of various scenarios Consideration and research of recent franchise transactions Valuation of team and stadium interests

7 VALUATION AND ADVISORY SERVICES Team Economics and Forecasting Our experience and in-depth knowledge of all four pro leagues, its structure and the actual financial performance of many teams enables us to: Perform meaningful revenue and cost analysis; Understand the merits of the subject asset against real benchmarks (as opposed to the sometimes unreliable data in the public domain) Develop realistic projections for better decision making Stadium Optionality Our team s recent and specialized knowledge base make us the most capable to evaluate the various structuring and economic scenarios associated with the team s potential new stadium scenarios. We envision efforts to include: Developing a range of economic scenarios and the benefits that would accrue to a new owner under those scenarios Utilizing recent transaction and negotiation experience with current owners, third parties and government agencies to develop a probability and time weighted optionality factor to apply to the expected benefits Employing real option theory to estimate a range of incremental bid pricing for a potential new stadium deal

8 OUR ADVANTAGES Expertise We are one of the leaders in sports valuation and related stadium advisory in the country and have considerable interaction and experience with management of the various leagues. Research Highly researched projections and pricing scenarios We know what teams and stadiums are capable of and what that means to an owner Service Dedicated and responsive team available for whatever is required Big 4 level of service with boutique fee structure

9 REPRESENTATIVE SPORTS ENGAGEMENTS Below we have provided some relevant examples of projects we have completed for our sports clients: Valuation Analysis Gift and estate valuations of franchises and minority interests in franchises Valuations for negotiations between parties for buyouts or sales between shareholders Buy & Sell-Side Analysis Assisted in formulating purchase price and proposed structure of new entity for an multiple pro sports teams over five times three were successful) Advised potential bidder on merits and risks of an NHL franchise during the pre-salary cap era. Client decided not to pursue opportunity Served on Executive committee for MLB franchise in sale process Provided due diligence for NFL teams Provided a pro-forma cash flow model for a MLB team Purchase Price Allocation Identified and recommended the fair market value of the intangible assets purchased for tax & GAAP reporting purposes (for over 20 pro teams) Work reviewed and approved by Big 4 accounting firms & the IRS

10 REPRESENTATIVE SPORTS ENGAGEMENTS Litigation Provided strategic valuation and advisory work to an existing MLB franchise ownership group for litigation purposes Marital dissolution purposes for several franchises Licensing/Media Rights Reengineered the rights, royalties and licensing processes of a major entertainment organization Assisted in negotiations and remodeling for various licensing agreements Tax Negotiations Dealt with the IRS on numerous occasions and have had some of the largest tax valuation issues approved 100% by the service. Successfully handled U.S. tax audits on numerous relevant issues for major sports leagues and several franchises

11 SPORTS TEAM EXPERIENCE Baseball (MLB & MiLB) Atlanta Braves Milwaukee Brewers Albuquerque Isotopes* Montreal Expos Baltimore Orioles New York Mets Boston Red Sox New York Yankees Chicago White Sox Philadelphia Phillies Cincinnati Reds Pittsburgh Pirates Cleveland Indians San Diego Padres Dayton Dragons* Seattle Mariners Florida Marlins South Bend Silverhawks* Houston Astros Texas Rangers Los Angeles Dodgers Washington Nationals * Minor League Baseball

12 SPORTS TEAM EXPERIENCE Basketball (NBA) Atlanta Hawks New York Knicks Boston Celtics Philadelphia 76ers Dallas Mavericks Sacramento Kings Houston Rockets Seattle Supersonics Indiana Pacers Toronto Raptors Los Angeles Clippers Vancouver Grizzlies New Jersey Nets Washington Wizards

13 SPORTS TEAM EXPERIENCE Football (NFL & AFL) Atlanta Falcons Houston Texans Baltimore Ravens New England Patriots Carolina Cobras* New Orleans Saints Carolina Panthers New York Jets Chicago Bears New York Dragons* Cincinnati Bengals Oakland Raiders Cleveland Browns Pittsburgh Power* Dallas Cowboys San Francisco 49ers Denver Broncos Tennessee Titans Detroit Lions Washington Redskins * Arena Football League

14 SPORTS TEAM EXPERIENCE Hockey (NHL) Anaheim Mighty Ducks New Jersey Devils Atlanta Thrashers New York Islanders Buffalo Sabres New York Rangers Dallas Stars Pittsburgh Penguins Edmonton Oilers Toronto Maple Leafs Los Angeles Kings Vancouver Canucks Montreal Canadiens Washington Capitals Soccer (NASL) San Antonio Scorpions

15 SENIOR SPORTS FRANCHISE PROFESSIONALS Donald Erickson, ASA Managing Director » Don Erickson is a Managing Director at Mercer Capital. Prior to Mercer Capital, Don was a owner of Erickson Partners, a valuation and advisory firm in Dallas, Texas. He is a former partner with Ernst & Young LLP s Corporate Finance Group. He has managed over 1,500 valuation engagements since his entry into the valuation profession in These engagements have been conducted for the purposes of litigation, sales/purchase, financing, allocation of purchase price, estate and gift taxes, employee stock ownership trusts, and business planning. He has conducted enterprise and minority stock valuations in a diverse range of industries on both a national and international level. Don has also been responsible for intangible assets appraisals including lease agreements, season ticketholder list, management contracts, customer lists, software, patents, trademarks, and player contracts. Don has valued or been involved with over 50 major league franchises in his career. He has valued major league sports franchises and player valuations in the top four major sports leagues. In addition to valuation studies, Don has advised several bidding groups including three ultimately successful groups in their analysis of pro sports teams. The analysis included reviewing the financial history, preparation of forecasts and advisement on the price for bidding purposes. He also has served on the Executive Committee of an MLB franchise which oversaw the sale of the franchise in Don served as the national head of sports valuation for a Big 4 firm until he retired in He has spoken on sports related issues to the International Conference on Sports Business at the University of South Carolina and to the Major League Baseball International Partners Group in New York City. He is also the former chairman of the Business Valuation Committee of the American Society of Appraisers.

16 SENIOR SPORTS FRANCHISE PROFESSIONALS Bryce Erickson, ASA, MRICS Senior Vice President » Bryce Erickson is a Senior Vice President at Mercer Capital a business valuation and financial advisory firm. He has been involved or managed hundreds of valuation engagements since his entry into the valuation profession in Bryce has developed particular experience in sports franchise consulting has been involved with a number sports valuation engagements over the past several years. He has participated and/or helped manage professional sports team transactions and valuations from several standpoints including merger & acquisition, financing, estate & gift taxes, and litigation. Consulting engagements have included valuation of franchises both on an enterprise and a minority level, financial analysis of sports teams, and intangible asset appraisals. Previous engagements and franchises Bryce has been involved with include: San Diego Padres Washington Nationals Dallas Mavericks Cleveland Browns Atlanta Hawks Atlanta Thrashers San Francisco 49ers Los Angeles Dodgers Seattle Mariners Los Angeles Sparks Buffalo Sabres Houston Texans Cleveland Cavaliers Buffalo Bills Dayton Dragons Albuquerque Isotopes South Bend Silver Hawks Prior to Mercer Capital, he was an owner of Erickson Partners, a valuation and advisory firm. Bryce also worked at KPMG, LLP in their valuation service group and with Prudential Capital group on teams that underwrote, structured and monitored a multi-billion lending portfolio. Bryce has a BBA from Baylor University and holds the ASA designation from the American Society of Appraisers and the MRICS designation from the Royal Institute of Chartered Surveyors.

17 MERCER CAPITAL SENIOR PROFESSIONALS

18 SENIOR MERCER CAPITAL PROFESSIONALS Z. Christopher Mercer, CFA, ASA, ABAR Chief Executive Officer » Chris is the founder and CEO of Mercer Capital. He has over 35 years of experience in the financial services industry. He has prepared, overseen, or contributed to more than a thousand valuations for purposes related to M&A, litigation, and tax compliance, among others. Chris has extensive experience in litigation engagements including statutory fair value cases and business damages and lost profits. He is also an expert in buy-sell agreement disputes. Matthew R. Crow, CFA, ASA President » crowm@mercercapital.com Matt has over 15 years of valuation and transaction advisory experience. Matt is active in valuations related to asset management firms and also has broad industry experience in insurance, real estate investment ventures, and technology companies accumulated by working with hundreds of client companies during his tenure at Mercer Capital. Along with Brooks K. Hamner, CFA, Matt publishes research related to the asset management industry. He is also active in Mercer Capital s financial reporting valuation practice.

19 SENIOR MERCER CAPITAL PROFESSIONALS Jeff K. Davis, CFA Managing Director of Financial Institutions Group » Jeff leads Mercer Capital s Financial Institutions Group. Prior to rejoining Mercer Capital, Jeff spent 13 years as a sell-side analyst providing coverage of publicly traded banks and specialty finance companies to institutional investors evaluating common equity and fixed income investment opportunities. Jeff is a frequent speaker at financial institution industry gatherings and regularly makes presentations to boards of directors and executive management teams regarding industry and market trends. Don Erickson, ASA Managing Director » ericksond@mercercapital.com Don has managed over 1,500 valuation engagements since his entry into the valuation profession in These engagements have been conducted for the purposes of litigation, M&A, financing, allocation of purchase price, estate & gift taxes, employee stock ownership trusts, and business planning. He has also testified numerous times in support of valuation opinions of business enterprises and intangible assets. Don has also testified as to the fair value of stockholder interests, valuation related accounting issues, solvency issues, lost profits, economic and financial damages to business interests. His testimony experience has been both in deposition and trial in both state and federal cases up to and including the U.S. Supreme Court.

20 SENIOR MERCER CAPITAL PROFESSIONALS Timothy R. Lee, ASA Managing Director of Corporate Valuation Group » Tim leads Mercer Capital s Corporate Valuation Group. He provides valuation and corporate advisory services for purposes including M&A, employee stock ownership plans, profit sharing plans, estate and gift tax planning and compliance matters, limited and general partnerships, corporate planning and reorganizations. In addition, Tim provides litigation support in cases involving dissenting shareholder rights, marital dissolution, tax matters, and other shareholder conflicts. Tim also has extensive experience in working with both sellers and buyers in merger and acquisition advisory engagements. Tim assists clients through all phases of the sales process, from conducting strategic alternatives analysis to determine if selling is indeed the best option, to structuring, negotiating, and closing transactions. Bryce Erickson, ASA, MRICS Senior Vice President » ericksonb@mercercapital.com Bryce leads Mercer Capital s Tax Valuation and Litigation Support team. He has been involved with hundreds of valuation and related engagements. These engagements have been conducted for the purposes of mergers and acquisitions, buyouts, buy-sell agreements, financial reporting, estate and gift taxes, allocation of purchase price, litigation support, financing, and business planning. In addition, he has experience performing lost profits analyses and economic damage studies. He has testified in both state and federal court in support of his opinions.

21 SENIOR MERCER CAPITAL PROFESSIONALS Andrew K. Gibbs, CFA, CPA/ABV Senior Vice President » Andy leads Mercer Capital s Depository Institutions team. He provides valuation and transaction advisory services to financial institutions for purposes including ESOPs, mergers and acquisitions, profit sharing plans, estate and gift tax planning, compliance matters, corporate planning, and financial reporting. Travis W. Harms, CFA, CPA/ABV Senior Vice President » harmst@mercercapital.com Travis leads Mercer Capital s Financial Reporting Valuation team. His practice primarily focuses on providing public and private clients with fair value opinions and related assistance pertaining to goodwill and other intangible assets, stock-based compensation, and illiquid financial assets. In addition, Travis performs valuations used for tax compliance, ESOP compliance, and other purposes. He leads Mercer Capital s Business Development Companies industry team.

22 SENIOR MERCER CAPITAL PROFESSIONALS Nicholas J. Heinz, ASA Senior Vice President » Nick leads Mercer Capital s Transaction Advisory Services team. Nick has extensive experience in providing valuation and corporate advisory services for purposes including M&A, fairness opinions, solvency opinions, employee stock ownership plans, buy-sell agreements, estate and gift tax planning and compliance matters, and corporate planning and reorganizations. In addition, Nick has provided transaction-related consulting services to numerous clients on both the sell-side and buy-side of transactions. Such consulting has included the delivery of transaction opinions, such as fairness opinions and solvency opinions, and strategic advisory related to transaction pricing and execution. Grant Farrell, ASA, CPA/ABV/CFF Vice President » farrellg@mercercapital.com Grant has been involved with hundreds of valuation and litigation support engagements in a diverse range of industries on both a national and international level. He has valued numerous complex and multitiered equity, preferred equity, mezzanine, debt and derivative securities. In addition, he has experience in valuing a wide variety of intangible assets such as patents, customer lists, trademarks, contracts, as well as performing lost profits analyses, economic damage studies as well as forensic accounting procedures and analysis. These engagements have been conducted for the purposes of mergers and acquisitions, buyouts, financial reporting, estate and gift taxes, allocation of purchase price, litigation support, shareholder dissent, buy-sell agreements, dissolutions, financing, and business planning.

23 SENIOR MERCER CAPITAL PROFESSIONALS Brooks K. Hamner, CFA Vice President » Brooks is active in valuation work for asset management firms and has broad industry experience gained during his tenure with Mercer Capital. Along with Matthew R. Crow, CFA, ASA, Brooks publishes research related to the asset management industry. Circumstances giving rise to the engagements Brooks is involved with include corporate planning, employee stock ownership plans, and estate and gift tax planning and compliance matters. In addition, he actively participates in projects in a litigated context. Lucas M. Parris, CFA, ASA Vice President » parrisl@mercercapital.com Lucas provides public and private company clients with fair value opinions and related assistance pertaining to goodwill and other intangible assets, stock-based compensation, and illiquid financial assets. He also has experience in engagements related to corporate planning and reorganizations, litigation support, ESOPs, and estate and gift tax planning and compliance matters. In addition, Lucas leads Mercer Capital s Insurance industry team.

24 SENIOR MERCER CAPITAL PROFESSIONALS Sujan Rajbhandary, CFA Vice President » Sujan Rajbhandary, vice president, is a senior member of Mercer Capital s Financial Reporting Valuation Group. Valuation opinions prepared by Sujan pertaining to business units, intangible assets, stock based compensation, and portfolio investments have been accepted by the largest U.S. audit firms. Sujan also values financial assets and liabilities for litigation support, tax compliance, ESOP compliance, and shareholder transactions. He also leads Mercer Capital s Medical Device industry team. Eden G. Stanton, CFA Vice President » stantone@mercercapital.com Eden has extensive experience with corporate planning and reorganizations, litigation support, employee stock ownership plans, and estate and gift tax planning and compliance matters. She is also actively involved in providing valuation services related to fair value opinions of financial institution assets such as depository customer relationships, loans, and certificates of deposit. Eden also leads Mercer Capital s Convenience Store industry team.

25 SENIOR MERCER CAPITAL PROFESSIONALS Laura J. Stevens, CFA Vice President » Laura has extensive experience with valuations for corporate planning, employee stock ownership plans, mergers and acquisitions, and estate and gift tax planning and compliance matters. Additionally, she has experience related to providing public and private clients with fair value opinions and related assistance pertaining to goodwill and intangible assets, stock-based compensation, loan portfolios, and other financial assets and liabilities. Laura also leads Mercer Capital s Agribusiness industry team. Jay D. Wilson, Jr., CFA, ASA, CBA Vice President » wilsonj@mercercapital.com Jay is a senior member of Mercer Capital s Depository Institutions team. Jay s practice encompasses the valuation of financial institutions for purposes including ESOPs, mergers and acquisitions, profit sharing plans, estate and gift tax planning, compliance matters, and corporate planning as well as financial reporting issues. Jay also leads Mercer Capital s FinTech industry team.

26 For more information about Mercer Capital s Professional Sports Services, visit: MERCER CAPITAL Headquarters 5100 Poplar Avenue, Suite 2600 Memphis, TN Dallas Merit Drive, Suite 480 Dallas, TX Nashville 102 Woodmont Blvd., Suite 231 Nashville, TN