Discussions between the NBA and investors have been ongoing since March 2026 for the formation of NBA Europe, but some suitors, including European football clubs, have taken issue with the proposed model.
NBA officials and potential investors for its NBA Europe league are reportedly at odds over the financial model of the proposed league.
NBA Europe is being proposed as a 16-team league, with 12 permanent spots and four spots to be determined via promotion and relegation, for a planned October 2027 launch.
This is a competition model designed to replicate what has been widely used across European football leagues in a bid to capture the significantly large european football fanbase.
Several current EuroLeague teams operate as a sister-team to European football teams, such as Real Madrid, FC Barcelona and Olympiacos. The NBA could be looking to leverage existing football clubs’ fanbases to translate over to basketball in an early fan engagement drive, according to The Athletic, but it is a strategy that could ultimately be determined by football clubs and their owners.
A source familiar with ongoing negotiations revealed to The Athletic European football clubs believe that the “NBA needs them much more than the clubs need the NBA”, and “it’s not a necessity”.
Of the football clubs and their owners that have been in discussions with the NBA, RedBird Capital, the majority owner of AC Milan and investor of Liverpool F.C., have been consistently named in reports.
European cities that have been earmarked for consideration for a NBA Europe franchise include London, Berlin, Paris, Milan, Manchester, Athens, Istanbul, Rome and Munich.
What the NBA is proposing for NBA Europe
After receiving interest from more than 120 prospective investors in March, which includes investment groups, high-net-worth individuals, European football clubs and basketball teams, the NBA moved onto phase two of the financial model process.
A source close to the matter told Insider Sport the NBA received several bids that ranged from $500m to $1bn, as well as several bids over $1bn, for 12 of the targeted European city markets. More than 20 offers came from existing basketball and football clubs, including EuroLeague teams.
Working alongside banking partners and financial advisors, JP Morgan and The Raine Group, the NBA has been reviewing and aligning the most compelling bids to align with its long-term vision for NBA Europe.
The current strategy is to develop a business plan that incentivises on-court and commercial performance, de-risk the financial profile of teams and optimise the model for long-term success via a collaborative process with potential investors.
The NBA is proposing guaranteed participation payments for every proposed NBA Europe franchise from year one. The league also proposed increased annual payments, and annual escalators, to teams based on participation and performance.
Bidding investors were informed of these proposals recently during phase two meetings, noting that the NBA will engage with its Board of Governors to select best partners for NBA Europe.
Mark Tatum, Deputy Commissioner of the NBA, said: “We have received significant interest from a range of prospective teams and investors for permanent franchise spots in a new league in Europe. The level of engagement and the scale of the bids reflect the marketplace’s belief in our proposed model and the enormous, untapped potential for European basketball.
“We will now review the bids in more detail and shortlist the partners who share our vision and commitment to accelerating the growth of the game across the continent.”
Furthermore, the NBA is committing up to $3bn to NBA Europe, its teams and the broader basketball ecosystem.
The ownership structure
The NBA is proposing a 52%-48% ownership split for NBA Europe, with the majority stake being owned by the NBA and International Basketball Association (FIBA), while the remaining minority stake being allocated to the member teams.
In future years, once NBA Europe is operational, permanent franchises will be able to benefit from expansion proceeds, with valuation proceeds being diluted rateably and reducing NBA’s and FIBA’s stakes to minority holdings, according to sources close to the matter.
The NBA and FIBA are offering 12 permanent places in NBA Europe, which makes these teams immune from relegation. This is in aim to provide long term financial stability and a clear path to profitability over the next several years once the league is launched.
NBA Commissioner, Adam Silver, has admitted NBA Europe will not turn a profit immediately given the amount of upfront investment it will need to kickstart the league. He also ensured there will be no distributions paid to current NBA team owners during the initial startup period, which the league anticipates will take a few years.
Where NBA Europe investment is going
The NBA plans to invest more than $3bn in support of the European league in a bid to reduce early-stage risks and build a path for future profitability.
The investment will be deployed across different verticals, such as for league-wide marketing campaigns designed to build a “valuable commercial product from day one”, shared a source close to the matter.
Investments will be made within the wider European basketball ecosystem and the future franchise markets. The NBA will support operational expertise, programming, content, as well as financial support.
The league will also cover early-stage losses to provide flexibility for teams to build additional capital, allowing ownership groups to focus on growth rather than short-term financial exposure.
Will NBA players be allowed to play in NBA Europe?
One of the proposals laid out by unnamed suitors during recent discussions with the NBA was the ability for NBA Europe franchises to sign NBA players to their rosters.
Some of the NBA’s best players today come from European countries, such as Giannis Antetokounmpo (Greece), Nikola Jokić (Serbia), Luka Dončić (Slovenia) and Victor Wembanyama (France).
Having a superstar-level player on a basketball team not only improves a team’s chances of winning a championship, but brings in significant additional revenue such as ticketing, sponsorships, merchandise and global recognition.
Therefore, the prospect of Jokić playing for KK Partizan in Serbia, or Wembanyama playing for a Paris-based franchise, would be at the forefront of investors’ minds and according to The Athletic, a football-inspired transfer fee acquisition process has been proposed.
The NBA immediately rejected the proposal according to the report, which investors cautioned that if they were unable to sign NBA players, NBA Europe would be at risk of being viewed, and ultimately used, as a feeder league for the US league.
Silver clarified in an interview with TSN last month the NBA does not view Europe as a feeder league, pointing to the G-League as the league’s primary development league and that the “elite of the elite in Europe will still, of course, want to play in the NBA”.
“No, we don’t see Europe as a feeder league,” said Silver. “The G-League is a pure developmental league. It’s frankly not a commercial entity. It’s an expense for the league in order to look what’s happening with two-way players.”
“We don’t see Europe as a feeder League. It may be that some of these players ultimately come into the NBA. But as I said, if you look at European basketball now, if you look at the FC Barcelona, Real Madrid, Bayern Munich, etc., this is top-notch basketball. I think for the foreseeable future, the elite of the elite in Europe will still, of course, want to play in the NBA. They’re probably around the edges, some European players who largely sit on benches in NBA teams who just assume stay home and compete at a high level there. But again it’s hard to predict the future but I just see right now that’s an immediate opportunity for European basketball.”
