Aug. 3 (Bloomberg) -- James Haslam III, a minority owner of the Pittsburgh Steelers, agreed to buy the Cleveland Browns for more than $1 billion, according to a person with direct knowledge of the sale who requested anonymity.
Haslam bought 70 percent of the Browns, who last made the playoffs in 2002, from Randy Lerner, the Associated Press reported. Forbes in September valued Cleveland at $977 million, ranking it 20th of 32 National Football League teams.
The Browns were 4-12 last season for last place in the four-team American Football Conference North division. Cleveland hasn’t won more than five games in a season since going 10-6 in 2007, one of three winning seasons since 1994. The Browns have never been to the Super Bowl and won the last of their eight NFL championships in 1964.
“To own such a storied franchise as the Cleveland Browns, with its rich tradition and history, is a dream come true,” Haslam said in a statement on the team’s website last night. “We are committed to keeping the team in Cleveland and seeing it get back to the elite of the NFL.”
Haslam will acquire the remaining 30 percent from Lerner four years from the closing date of the sale, AP said, citing people familiar with the deal.
The transaction, which requires Haslam to sell his minority stake in the Steelers, is subject to approval by 24 of the NFL’s 32 team owners. The deal should close shortly after owners vote on it, Lerner said. Until then, all senior executives will remain in place.
Steelers spokesman Burt Lauten declined to say whether existing owners will buy Haslam’s share or if he will put it on the market to the highest bidder.
Haslam, 58, is president of Pilot Travel Centers LLC, the nation’s largest operator of travel centers and truck stops. He is also the brother of Tennessee Governor Bill Haslam.
Cleveland was without an NFL franchise after the 1995 season ended when Art Modell moved the team to Baltimore and renamed it the Ravens, 11 years after the late Robert Irsay packed up the Baltimore Colts in the middle of the night and moved them to Indianapolis.
The league subsequently promised to put a new team in Cleveland and allow it to retain the Browns nickname and its signature orange and brown team colors.
Lerner’s father, Al, was awarded the expansion franchise on Sept. 8, 1998, for $530 million, then the highest price paid for a North American professional sports franchise, exceeding the $311 million paid by News Corp.’s Fox Sports for the Los Angeles Dodgers.
Randy Lerner, 50, who also owns English Premier League soccer team Aston Villa, took control of the Browns in October 2002 after his father’s death.
The Browns had revenue of $247 million and an operating loss of $2.9 million after the 2010 season, according to Forbes.
“While as a fiduciary I have always felt it was my responsibility to listen to offers, I had not been approached with a proposal that felt as natural and complete as Mr. Haslam’s,” Lerner said in a statement. “He had done a lot of work on the Browns and the city of Cleveland and, first and foremost, gave me his personal assurance the team would remain in Cleveland.”
After consulting with his sister and mother, Lerner said all agreed “the proposal was strong, the buyers made sense and the time was right for us to move on.”
Haslam became a part owner of the Steelers in 2008, the first time the ownership of the franchise expanded beyond the Rooney and McGinley families. Growing up a Dallas Cowboys fan, Haslam had investigated other ownership opportunities before the Steelers opportunity arose.
Haslam, who joined his father’s company in 1976, has seen Pilot Travel Centers increase annual sales to 8 billion gallons from 125 million gallons at 600 locations in 43 U.S. states and six Canadian provinces.
Haslam’s wife, Susan Bagwell Haslam, is chief executive officer of RIVR Media Enterprises LLC, a Knoxville, Tennessee-based producer of television programs.
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