March 13, 2024
Andrew Petcash

Merging of Sports Leagues: And Why We Will See More

Major League Pickleball and PPA Tour finally completed the long-awaited merger…

Here’s a list of other recent sports league mergers:

LIV Golf and the PGA Tour (not yet closed)
XFL and the United States Football League (USFL)
Major League Lacrosse (MLL) and the Premier Lacrosse League (PLL)
NBA, NFL, NHL, MLB, and every sport we love at some point

I think it’s important to look at these events’ history and where it’s headed next.

Let’s Dive In 👇

Mergers

As you’ll see below, what typically forces a merger is a combination of:

different markets captured
wealthier owners in one entity
one league paying higher salaries
innovative models or rule changes

One of my finance professors at Boston University used to say:

“𝘛𝘩𝘦 𝘣𝘦𝘴𝘵 𝘤𝘰𝘮𝘱𝘢𝘯𝘺 𝘵𝘰 𝘣𝘶𝘪𝘭𝘥 𝘪𝘴 𝘢 𝘳𝘦𝘱𝘭𝘪𝘤𝘢 𝘰𝘧 𝘰𝘯𝘦 𝘵𝘩𝘢𝘵’𝘴 𝘢𝘭𝘳𝘦𝘢𝘥𝘺 𝘣𝘶𝘪𝘭𝘵”

His examples: Lyft > Uber, VRBO > AirBNB, Upwork > Fiverr.

And interestingly…this is especially true when it comes to sports leagues.

History of Sports Mergers

Before we get to the landscape today, let’s dive into some of the most important sports mergers throughout American history.

And don’t forget, many of these sports were viewed as “niche” at one point.

NFL (AFL + NFL)

In 1959, Lamar Hunt (the son of an oil magnate) approached the NFL about founding a second franchise in Dallas.

The NFL wasn’t interested in expansion, so Hunt founded his own rival league, the American Football League.

afl founder lamar hunt — Lamar Hunt paid $25k for the Chiefs.

In a year’s time, the AFL debuted with eight franchises across the United States.

The league grew quickly by:

targeting football-less markets
mining small universities and black colleges
added player’s names on the backs of their jerseys
adding two-point conversions and a 14-game regular season

However, the main advantage was that the AFL owners were simply richer than their NFL counterparts.

By 1966 the competition had grown so fierce that the NFL called for peace talks, eventually culminating in the merger and the first-ever AFL-NFL World Championship Game — a.k.a the Super Bowl.

NBA (ABA + NBA)

After watching the AFL-NFL merger…

Dennis Murphy formed the ABA with the express intent of one day merging it with the NBA…

The ABA was billed as the splashier alternative:

three-point arc
team cheerleaders
slam-dunk contest
young players in Julius Erving, George Gervin, and Connie Hawkins

The two leagues officially joined in 1976, after several years of finalizing an ongoing antitrust lawsuit.

NHL (WHA + NHL)

The 12-team WHA was founded in 1971 by the same group that founded the ABA in basketball.

It intended to operate as a direct competitor to the NHL (with a future merger in mind).

How they got traction:

signed players under 20 years old
longer contracts & larger payments
placing teams in mid-sized Canadian markets

Hockey was the final of America’s “Core Four” sports to undergo its painful, but ultimately successful merger.

The merger vote initially failed, but a boycott of Molson products, owners of the Montreal Canadiens led to a revote.

MLB (NL + AL)

In 1892, the NL merged with the upstart American Association, known by some as the “beer and whiskey league” because they would sell alcohol at games.

The merger formed a new 12-team league that lasted until 1899 when the NL dropped four franchises.

Those teams banded together to form the American League (AL) and began encroaching on the NL’s East Coast territory, picking up star players and new fans along the way.

This period became known as the “baseball war” and lasted until 1902.

Finally, the NL and AL united under a single National Commission, cementing their new truce with an inter-league championship game called the “World Series.”