Green Bay Packers Stock Offering: Packers 12, Shareholders 0

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Green Bay Packers Stock OfferingCost of a Green Bay Packers jersey on NFLShop.com: $109.99.

Ticket to see the 12-0 Packers take on Oakland at Lambeau Field this Sunday: $115 (and up).

The cost of owning a winning franchise: priceless.

Good news, Packers fans. This week only, you actually can own a piece of the Pack for the low, low price of just $250. As announced on its website Tuesday morning, for the first time in more than a decade the Pack is opening itself up to public ownership. In order to raise funds to add seats and "new amenities" at Lambeau Field, the team is offering interested parties the chance to buy part-ownership of the Packers in the form of "shares" sold on its website. The cost: $250 apiece (200 shares max), plus $25 shipping and handling.

That's what it will cost you to own a piece of the dream. But what will you actually get for your $275 to $50,025 "investment" in the Green Bay Packers? Ah, that's the real question. And I've just leafed through the firm's 20-page virtual "prospectus" and can give you some answers.

You Are Invited ... to a Meeting

Here's the Packers' sales pitch in a nutshell, straight from the word processor of Team President and CEO Mark H. Murphy:

I encourage you to buy shares of stock in the Packers. We need your help. As an owner, you will be invited to shareholder meetings and have voting privileges. Ownership will also provide you with significant bragging rights. You will become an owner of the defending world champions, a team that has won more world championships than any other team in the NFL.

Offering to sell 250,000 shares initially, and up to 880,000 shares total if that's what the market will bear, the Packers stand to make anywhere from $62.5 million to $220 million off this share issuance. In exchange, they're offering to give you:

  • Bragging rights
  • The right to sit in a meeting

And ... that's it.

Where Are the Perks?

The prospectus goes out of its way to point out that "a purchaser of [GB] Stock in the Offering will not receive any special benefits, such as access to tickets to Packers games, preferential seating for Packers games or discounts on Packers merchandise."

Sounds like a raw deal. So what about the "return" on this investment?

Since its third public offering in 1950, when shares sold for a split-adjusted price of $0.025 per share, the price of a GB share has increased 10,000 times. For comparison, that's about 200 times better than the price appreciation for an ounce of gold -- or the Dow Jones Industrial Average. It's a comparable return to the one Apple (AAPL) investors saw since 1984, Ford (F) since 1977, or IBM (IBM) since 1963 (the longest periods for which data is readily available). It's actually on par with the performance that Berkshire Hathaway (BRK-A) (BRK-B) shareholders have enjoyed under Warren Buffett's tenure since 1965.

And yet, despite these stellar "paper profits," GB's stock prospectus makes clear that the stock GB is offering today "does not constitute an investment in 'stock' in the common sense of the term." The stock's astronomical historical returns notwithstanding, purchasers today "should not purchase [GB] stock with the purpose of making a profit."

Looks Good on Paper. And That's It.

Indeed, "in light of the transfer restrictions and redemption rights" attached to the shares, "it is virtually impossible for anyone to realize a profit on a purchase of [GB] stock or even to recoup the amount initially paid to acquire such common stock." (Emphasis added.)

Why is that? Because technically speaking, the Green Bay Packers is a nonprofit corporation. As such, it does not earn "profits" or pay dividends. And unlike with a for-profit corporation, investors cannot resell their shares for a profit if the team does well. As the prospectus clearly states: "the Corporation has a right of first refusal to repurchase [GB] Stock at a price of $0.025 per share if any shareholder proposes to transfer his or her [GB] Stock to a third party."

Translation: Those shares you just paid $250 apiece for? The moment you put 'em in your pocket, they lost 99.99% of their resale value.

It almost goes without saying that such a lousy deal for "investors" is not endorsed by the Securities and Exchange Commission. For that matter, the SEC hasn't even "approved" the offering. Nor has the offering been registered under the Securities Act of 1933. Nor does the offeror believe investors can depend on any "federal, state or international securities laws" to protect their investment in the "offering."

You Make the Call

So what's my read on the Green Bay Packers offering? With tens of millions of dollars being raised to improve the quality of their facilities and permit charging higher ticket prices to their fans, management's going to make out like bandits from this offering. Players will make money, too.

But the "shareholders"? All they get for their $250 is exactly what the prospectus promises: The right to attend a shareholders meeting and the right to brag about it. Or basically, the same things you can get for the price of a jersey and a ticket to Sunday's game ... for $25.01 cheaper.

Seems to me, somebody's playing the Packers fans for chumps.

Motley Fool contributor Rich Smith does not own shares of any companies named above. The Motley Fool owns shares of International Business Machines, Apple, Ford Motor, and Berkshire Hathaway. Motley Fool newsletter services have recommended buying shares of Ford Motor, Apple, and Berkshire Hathaway. Motley Fool newsletter services have recommended creating a bull call spread position in Apple.



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29 Comments

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sam

I purchased on Dec 8, 2011, as a gift for someone. Have heard absolutely nothing from them period. I have called the number many times over the past few days with the only advice being to watch my email and wait for UPS, and that I would get it in time to gift for Christmas. Ok, they scammed me for 275.00. I'm considering a class action lawsuit for all parties that didn't get the certificates as indicated in the agreement. Why the Packers management would entrust "distribution" to a CPA firm and not Amazon is beyond me.

December 24 2011 at 7:00 PM Report abuse rate up rate down Reply
rit037

MY ORDER TO PURCASE STOCK IN THE PACKER ORGANIZATION WAS SUCCESSFULLY SUBMITTED SOME TIME AGO. MY CONFIRMATION NUMBER ID 4733225727. I HAVE HEARD NOTHING SINCE THIS CONFIRMATION.DOES ANYONE KNOW WHEN DELIVRY OF STOCK CERTIFICATE WII TAKE PLACE? PLEASE RESPOND....THX

December 21 2011 at 9:53 AM Report abuse rate up rate down Reply
Wikeau

Go ask a Redskins fan if they would be willing to spend $275 to get rid of Dan Snyder. If they say no, then they are actually either a Giants fan, a Cowboys fan or broke.

December 19 2011 at 3:15 PM Report abuse rate up rate down Reply
leta_smith69

I would darn sure buy stock in Aaron Rogers. YUMMY!!!!!!!

December 13 2011 at 9:59 AM Report abuse rate up rate down Reply
russ.dorn

Its the Packers. Thats all you have to say. We are proud to be"chumps" as you call us. it sounds as though you and fans of all the other teams are jealous that you could not put together enough to by a "share" in your team. We all know that it is not an investment that will turn a profit, but then again look at all the "chumps" that voted for President obama who will not even have bragging rights when he is done. I will take my "share" of the Packers and just enjoy the fact that I have something nice to hang on the wall. Sour grapes and you must really have a miserable life that you can't just do somehting for fun.

Oh, Merry Christmas.

December 11 2011 at 9:45 PM Report abuse rate up rate down Reply
koebs

All I gotta say dude is you really don't understand. Do you honestly think people go into buying these shares actually thinking that they will receive anything beyond a feeling of good will? Do you understand sports, or rather the Packers in general? They are one of the most loved teams in the league, was just recently rated as one of the most popular sports franchises in the world, and they WIN. Do you really think that they'd move their team somewhere because some deep pocketed owner would buy the team? Oh wait they can't because of this exact situation, do you understand this? Obviously your critical thinking skills are lacking if you cannot comprehend anything beyond money.

December 11 2011 at 12:46 PM Report abuse rate up rate down Reply
imraku

If your not a packer fan you would'nt understand, I purchased shares for my daughter and son. Now we are all part owners! See all my other shareholders friends in July. GO PAC!

December 10 2011 at 9:37 PM Report abuse rate up rate down Reply
1 reply to imraku's comment
sallysuek

so you're either got more money than you do what to do with it, or you're a moron. The stock are worthless. You can't even get you $250 back.

December 11 2011 at 6:36 PM Report abuse rate up rate down Reply
larrydickwell

I broght packers.Stock to sell short,they will not make playoffs,

December 08 2011 at 6:53 PM Report abuse rate up rate down Reply
mbeam50

I can sure tell you're not a Packers fan. You've missed the whole point. Mbeam

December 08 2011 at 4:38 PM Report abuse rate up rate down Reply
BUFFALO

Its a donation it should not be legal to call it stock. I am surprised there are any takers these must be the packer backers? There are a lot more worthy charitie's out there other than arron rogers for pete's sake don't you know??

December 07 2011 at 3:12 PM Report abuse rate up rate down Reply
1 reply to BUFFALO's comment
Walter Baranger

It's not a donation, because the Packers are not a charity and share owners get voting rights.

This is actually pretty simple; If you are a Packers fan and you want to ensure that the team stays in Green Bay and, given its small market, does not incur undue debt for capital projects - such as a stadium expansion -- buying a share or two helps accomplish both goals.

If you aren't a Packers fan or you have a philosophical problem with not-for-profit corporations and the ways that they raise money, then don't buy the shares. Easy.

December 08 2011 at 10:21 AM Report abuse rate up rate down Reply