Why Stan Kroenke won’t milk Arsenal to finance Rams

From Jay W. Chamberlin

Myles,

Whatever the intentions of Stan Kroenke and Kroenke Sports & Entertainment (“KSE”), gooners can rest assured that your ipse dixit assertion that KSE is “more interested in taking cash out of Arsenal and putting it into the Rams” is mistaken.

Why on earth would Kroenke and KSE do that?

The Los Angeles Rams is one of the best positioned short- term sports businesses and long-term investments among sports teams and clubs worldwide.

The Rams are worth more than Arsenal.  Forbes ranks the Rams as the fourteenth most valuable team globally at $3 billion – Arsenal rank 39th at $2.4 billion.

https://www.forbes.com/sites/kurtbadenhausen/2018/07/18/full-list-the-worlds-50-most-valuable-sports-teams-of-2018/#3a3202586b0e

The Rams spend less, in total, on players.

Unlike Arsenal, the Rams’ players’ wages are capped by a league-wide mandate at around 47% to 48.5% of league revenue.

(https://www.politifact.com/truth-o-meter/statements/2018/aug/13/donald-trump/do-players-get-most-nfl-revenues-donald-trump-says).

Presently, the Rams wage bill is approximately $177 million.  (https://overthecap.com/salary-cap/los-angeles-rams) Arsenal’s wage bill, on the other hand, is approximately $300 million. (https://en.as.com/en/2018/01/17/football/1516210881_006124.html).

The Rams pay better players less money than Arsenal.  Mesut Özil, a good player to be sure, but not in anyone’s all-world or all-league first choice 11, is paid $23.4 million per year by Arsenal.  (https://www.goal.com/en/news/mesut-ozil-net-worth-arsenal-midfielders-salary-sponsorships/vjyhuzamqeu5154lhg3tgolo9).

The Rams pay both the NFL’s best running back, Todd Gurley at $7.2 million per year, and best defender, Aaron Donald at $8.9 million per year, less. (https://overthecap.com/salary-cap/los-angeles-rams).  Finally, the NFL generates more revenue than the Premier League.  Under their current broadcast rights deals, the NFL receives approximate $4.5 billion per season, while the Premier League receives only $2.3 billion. (https://www.pledgesports.org/2018/01/biggest-tv-rights-deals-in-sport).  The Rams are valued more, generate more broadcast revenue, and pay players less.  There is no need to take Arsenal’s profit and use it to fund the Rams.

Moreover, there is no reason to believe that Kroenke and KSE are content to see Arsenal remain mired in mediocrity.  In the Rams, Kroenke and KSE have built what American pundits have called “the best team in football, full stop,” with the best statistical odds to win a championship this season.  (https://www.theringer.com/nfl/2018/10/5/17941058/nfl-quarter-season-power-rankings); (https://www.footballoutsiders.com/stats/playoffodds).

That’s not to suggest that 100% ownership by KSE will turn Arsenal into Manchester City, but that there’s a greater likelihood that Arsenal will return to a respectable level of success than be robbed of resources and turned into Leeds.

I love your site, even (or, maybe, especially) when I disagree with you.

Myles says: 

American gooners are quicker to accept the KSE business model. But as an Englishman brought up on football, cricket, rugby and boxing, the NFL is wholly foreign to me and always will be.

The day I went to see the Chicago Bears at Wembley was by far the most boring day of my life and having the NFL rammed down my throat every morning by an American corporation has obliged me to consider ending my relationship with Sky.

NFL is a business created by Americans for Americans, many of whom enjoy following the games from outside the United States. That’s fine. Each to his own culture.

It’s just that I think of Kroenke as a real estate guy, not a sports owner. He has no visible or audible personality. Of course it’s nice for him to work in a cartel of billionaires who can do whatever they like.

Is the Rams new stadium being built on a swamp?