Washington Ownership Debacle: Snyder In The Way?

Chris Russell

LANDOVER, Md. - It truly never ends under the big-top known as the Washington Football Team circus. 

For months, we've heard about the war brewing between former close friends and current business partners. Dan Snyder vs. 'FedExFred' Fred Smith, Dwight Schar and Bob Rothman. 

The four primary owners of the Washington Football franchise are trying to divorce each other, but can't even do that without conflict. 

Per a recent report from the Washington Post, Snyder is exercising (selectively) his right of first refusal on a potential sale of 40% of the organization, the collective share of Smith, Schar and Rothman. 

According to the report, "the prospective buyers are Behdad Eghbali and Jose Feliciano — billionaire co-founders of Clearlake Capital, a private equity firm based in Santa Monica — and Feliciano’s wife, Kwanza Jones, a singer/songwriter and philanthropist who grew up in the D.C. area."

Apparently, the three minority partners want so badly to be rid of Snyder and their investment that they are willing to take a mere $900 million for their portion. 

Forbes' last annual estimated value of the Washington Football Team was $3.5 billion after the disastrous 2019 season and before this debacle of a season began. 

Even if the $3.5 billion is not realistic because of the COVID-induced realities for 2020 and probably beyond, a 40% stake of the organization  should not go for and be accepted for $900 million when it could be worth around $1.4 billion under normal circumstances. 

Yet the trio reportedly and  tentatively accepted the offer. 

However, as The Post noted, Snyder is blocking the sale, "by attempting to selectively exercise his right of first refusal to buy back minority shares of the team before they’re sold to other parties. While the three minority owners are seeking to sell their 40-percent share in unison, according to these people, Snyder has offered to buy only the 25 percent held by Smith and Rothman, not the 15 percent owned by Schar."

That's the key here: Why? Here are two guesses: 

1. It's possible that Snyder doesn't have the pure capital to buy the remaining 40% and a financing structure to do so might be extra complicated considering the current situation and short-term future. 

We're talking roughly another $500 + million that he would have to front based on the $900 million offer and arrangement for the 25% stake that Snyder is apparently willing to buy and obviously a minimum of $900 million to purchase the entire 40% stake. 

However, a question has to be asked. Would Schar, Rothman and Smith be willing to sell their 40% share to Snyder for the discount price they agreed to with the other group? Probably not. 

2. If Snyder is willing to buy the 25% stake but not Schar's 15% -- that could say one other thing. It seems as if his battle with Schar is way more deeply rooted than it is with Rothman and Smith. 

Both sides have launched legal battles against each other and the feud has seemingly become deeply personal with Snyder essentially accusing Schar of financing a takedown of Snyder with the help of former employee, Mary Ellen Blair, and Jessica McCloughan, the wife of former GM, Scot McCloughan.  

The legal battle between two stubborn, rich men has spilled into family with Snyder accusing Schar's family of providing discounted living arrangements for Blair. 

Is it possible that Snyder wants Schar to basically suffer and not get what he wants because he feels he has been the driving force between the leaked rumors and stories that Snyder is suing for? 

Snyder has sued more parties over the last few months than combined wins his football team since 2018.

Apparently, the attempt by the three partners to get a federal court to force Snyder to permit the sale did not sit well with Snyder or the NFL 

That should not be a surprise and if true, it means that the NFL and owners are not happy at all with Snyder or his three partners. Several owners and the league office have been furious with Snyder's operation and what we would term a decay of the franchise over the years. 

Confidentiality issues are holding up the full disclosure of the case but the Post was able to get the information they provided and the The New York Times has other details on the ownership problem, which many fans would suggest is simply a Snyder problem.

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