An investor group led by former Nike executive Melanie Strong is poised to submit a formal offer to Portland Thorns owner Merritt Paulson in a bid to acquire a majority interest in the NWSL team with a valuation of $60 million, sources have told ESPN.
The two sides have had a series of meetings over the last two months, and the offer is expected to be submitted within the next week. A source said that Strong's group is confident that acquiring sufficient capital won't be an issue.
The all-woman investor group is comprised of about 30 people, with the core group comprised of six investors. Sources confirmed that Strong's group is also collaborating with a fan-led investor group led by local tech entrepreneur Chris Bright, and that there is "zero interest" in moving the team out of Portland.
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On Thursday, Paulson announced his intention to sell the Thorns, but not MLS side the Portland Timbers, which he also owns with his father Hank through an entity called Peregrine Sports.
Paulson has been under pressure to sell both the Thorns and the Timbers ever since allegations of sexual harassment and coercion were made against former Thorns manager Paul Riley, for which he was fired for cause in 2015.
That pressure -- from both fans and sponsors -- increased following the release of the Yates Report, which detailed systemic sexual and emotional abuse throughout the league. In addition to allegations made against Riley, the report detailed how the Portland organization sought to keep quiet the reasons for Riley's departure.
The Yates report stated that the Thorns organization as well as accusations by investigators that Paulson and the Thorns "interfered with our access to relevant witnesses and raised specious legal arguments in an attempt to impede our use of relevant documents."
In a bid to placate both fans and sponsors, Paulson fired president of soccer Gavin Wilkinson and president of business Mike Golub. Paulson then stepped down as CEO of both teams on Oct. 11, but had retained his ownership interest.
Arctos Sports Partners acquired a 15 percent stake in the Timbers and Thorns organization in 2021.
One source with knowledge of the discussions indicated that at present the proposed deal is to acquire the Thorns only, a detail first reported by Willamette Week. While Strong's group is open to discussing acquiring the Timbers as well, sources tell ESPN that Paulson intends to retain the MLS team.
Given the number of shared resources between both teams from ticketing to support staff, acquiring just one of the teams could make any potential deal complicated, though there could be advantages as well. By building a leadership team that is just specific to the Thorns, the expectation is that from a sponsorship perspective, from a fan experience perspective, from broadcast rights, the Thorns could maximize those aspects to a greater degree than if they were still affiliated with the Timbers.
Strong's group is proposing a hybrid model by which one-third of the staff would be shared among both teams. The source said that one of the group's biggest priorities is "doing right by the players. So creating an environment and a structure and an organization where abuse can't take place, where there's safety, where there's values alignment around how to protect the players from having to experience any of that."
But Strong's group is walking a fine line in negotiations. Paulson is keen to try and rehabilitate his legacy as it relates to women's soccer given that the Thorns have been part of the NWSL since the beginning of the league in 2013, and Paulson has been instrumental in providing financial stability for the league over the years.
Despite the calls from fans for Paulson to sell one or both of the teams, he doesn't have to sell. That may change when the results of the joint NWSL/NWSL Players Association investigation come out, which is expected to happen by the end of 2022. But for the moment, there is little in the way of internal pressure from either the NWSL or MLS forcing Paulson's hand.
Prior to MLS Cup, MLS commissioner Don Garber said: "At this time, we don't see any reason at all for Merritt to sell the Timbers. There was nothing that came out in the [Yates] report that would have us think any differently from what I just stated."
The amount of money it would take to complete a deal depends on what is included. A source said the bid from Strong's group would go beyond just the operating rights, and include other aspects such as media rights, other value that is derived from the stadium, and additional intangibles. There is a sense that not including these items would lower the purchase price -- good for the buyers -- but would not be as desirable strategically since otherwise those aspects would stay exclusively with the Timbers.
Strong's group doesn't want to be tenants of the Timbers within Providence Park. The City of Portland owns the venue, with Peregrine Sports leasing the venue from the city.