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How the Broncos sale is expected to proceed, step by step

By late March or early April, an estimated group of 10 potential bidders worth examining further are expected to be identified.

DENVER — With the Denver Broncos now up for sale, the team, through its hired sellers, is expected to eventually receive “dozens of initial inquiries,” according to a source familiar with the process.

Say what you will about the team's poor on-field performance the past five or six years. The Broncos, as one of the most storied members of the white-hot NFL, remain one of the globe's most popular sports franchises.

All calls received from interested parties are taken seriously. Here’s why: Because so much global wealth has been created in the past decade or so from the likes of Silicon Valley, technology and other digital-driven business, the chances are greater today than ever before there may be a hidden billionaire out there who nobody knows about.

“There are crypto billionaires now,’’ a source said. “It’s not just old-school.”

After the Broncos were held for nearly 38 years by Patrick D. Bowlen or his trust, the expectation is it will take six months before the transaction to the team’s new owner or ownership group is complete. That puts it right around the time the Broncos begin their 2022 training camp in late July.

The Denver franchise was valued at $3.75 billion last fall by Forbes Magazine. While Forbes is not likely to have access to the deep dive "data room" of a franchise’s revenues and expenditures, it does cull an accurate-enough summary to suggest $3.75 billion as a fair expectation for the final-round bidding’s floor price.

Last week, Joe Ellis, one of three trustees to the Patrick D. Bowlen Trust where the Denver Broncos franchise is held, announced that Steve Greenberg of Allen & Company and Joe Leccese of Proskauer Rose LLP would be facilitating the team’s sale.

RELATED: The Broncos are officially up for sale

They are the hottest sell-side brokers in sports.

Allen & Company represented the owners in the most recent team sales in the NFL, NBA and Major League Baseball. The NFL Carolina Panthers went to David Tepper for $2.25 billion in 2018, the NBA Brooklyn Nets were sold to Joe Tsai for $2.35 billion in 2019 and the MLB New York Mets went to Steve Cohen for $2.4 billion in 2020.

There figures to be a quantum leap in sale price for the Broncos.

Credit: Matt Lekawa @zlek131

Here is the expected sequence of events involved in the Broncos’ ownership transition:

— For the first several weeks, Greenberg, Leccese and their associates will take calls from interested parties, while they will also solicit interest by calling those known to have the wherewithal to make such a substantial transaction. At the same time, the financial folks will separate those with legitimate interest who can handle the transaction from those who can’t. Throughout the process, Greenberg and Leccese will report to Ellis and the two other Bowlen trustees, Rich Slivka and Mary Kelly.

— By late March or early April, an estimated group of 10 potential bidders worth examining further by Greenberg and Leccese are expected to be identified and nondisclosure agreements will be signed. The nondisclosure agreements work both ways – the trustees and those working with them can’t disclose the confidential portfolios of the investors, who will show their cash, stocks and bonds, and fixed assets (properties and companies) to prove their worth. And the bidders can’t reveal the revenue and expenditure book they get from the team.

— In the second round of the auction-like process, the group of potential bidders will be narrowed to “about a handful.” It’s possible these finalists would then receive access to the Broncos’ “data room,” which has every coach, player and personnel staff contract, every sponsorship and vendor contract, every piece of revenue coming in and every piece of expenditure going out, down to the stadium maintenance costs.

— Finally, it will be time to pick a winner. The highest bid is likely to be the winning bid, although the NFL will be involved in the final decision. In the Carolina Panthers sale four years ago, David Tepper was awarded the winning bid even though his $2.25 billion purchase price was lower than that of the Ben Navarro group. A big reason for this was Tepper was able to write a check for nearly the full amount while Navarro, according to sources, had his offer structured with more investors and more debt.

Subsequent to that Panthers’ deal, the NFL has increased the amount of debt the new buyer can carry at acquisition from $500 million to $1 billion.

The new owner or ownership group, thus, would have to come up with at least $3 billion cash if the Broncos are sold for $4 billion. The chances are better for the bidder who can write a check for $4 billion. It doesn’t appear the franchise will be struggling for ownership suitors.

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