Owners Box: Club Member Newsletter - April 1st
French league approves CVC deal, Formula 1 confirms Vegas night race, Arctos announces 6 teams in MLB portfolio, 777 Partners adds Belgian club
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Highlights:
Formula 1 Adds Third U.S. Race; Announces Saturday Night Race In Las Vegas For 2023
Pacific Media Group Co-Founder Nears Stake in German Soccer Team
Larry Ellison’s SailGP and Near Protocol to Create a DAO for Sports Team Ownership
U.S. Investment Firm Buys Belgian Soccer Club Standard Liege
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Recent Sports M&A News and Developments
French league approves $1.66 billion deal with CVC Capital - The Washington Post - April 1st, 2022
PARIS — The French soccer league announced an investment deal Friday with private equity firm CVC Capital Partners as part of a new commercial subsidiary in charge of marketing media rights.
The league said its general assembly unanimously approved the creation of the subsidiary and CVC’s commitment to invest 1.5 billion euros ($1.66 billion).
The league, known as the LFP, said most of the financial contribution will be paid to professional soccer clubs, with another share used for amateur soccer and the repayment of a state-guaranteed loan contracted in 2020.
Some of the money will also be used for a reserve fund and to start the commercial subsidiary’s activities, the league said.
In return for its investment, CVC will hold a 13.0% stake in the league, valuing the entire capital of the commercial subsidiary at 11.5 billion euros ($12.7 billion).
Formula 1 Adds Third U.S. Race; Announces Saturday Night Race In Las Vegas For 2023 - Forbes - March 30th, 2022
Formula 1 racing is coming to the Strip in Las Vegas.
The announcement that was made Wednesday night at the Cosmopolitan Hotel in Sin City by Formula 1, and the Las Vegas Convention and Visitors Authority (LVCVA) will see the global racing series host its first race in 2023. To add to the visuals the race will take place on a Saturday night in November.
The press conference featured Liberty Media President and CEO, Greg Maffei and Formula 1 President and CEO, Stefano Domenicali along with local stakeholders including Nevada Governor Steve Sisolak, CEO and President of the LVCVA, Steve Hill, and President and CEO of Live Nation Entertainment, Michael Rapino.
The race sees a number of key Las Vegas partners along with F1 and their ownership, Liberty Media, including promoter Live Nation Entertainment, Caesars Entertainment, MGM Resorts International, and Wynn Las Vegas, and presenting partners MSG Sphere, Resorts World Las Vegas, and The Venetian Resort.
Pacific Media Group Co-Founder Nears Stake in German Soccer Team - Front Office Sports - March 24th, 2022
A deal for 10% of FC Kaiserslautern could reportedly be announced soon. Conway is working with investors and multi-team co-owners Chien Lee and Krishen Sud, Tampa Bay Rays co-owner Randy Frankel, and former Rays executive Michael Kalt on the bid.
Known for targeting lower-division teams, often with a limited track record of success, Pacific Media Group co-owns a growing collection of European soccer teams.
EFL Championship’s Barnsley FC (Oakland A’s executive Billy Beane also owns a stake)
Ligue 2’s AS Nancy
Esbjerg FB of Denmark’s First Division
Belgian Pro League team KV Oostende
Swiss Challenge League team FC Thun
FC Den Bosch of the Netherlands’ Eerste Divisie
Local investors acquired 33% of Kaiserslautern in 2020 for around $12.1 million.
Larry Ellison’s SailGP and Near Protocol to Create a DAO for Sports Team Ownership - CoinDesk - March 24th, 2022
Global sailing league SailGP – founded by Oracle Chairman Larry Ellison – and the Near Protocol are creating a decentralized autonomous organization (DAO) to enable fans to be owners of sports teams, according to a statement on Thursday.
"We are ushering in a brand-new era of entertainment by combining sports and technology to elevate the fan experience to a level that has never been seen before, and we’re proud to be leading the way alongside a like-minded organization that shares our core values and vision," Marieke Flament, CEO of the Near Foundation, the non-profit entity that oversees development on the Near blockchain, said in the statement.
A DAO is a blockchain-based form of organization or company governed by code, rather than leaders. Anyone who purchases the DAO's native token has the right to vote on important matters related to the DAO. The Near Protocol's native token, NEAR, is trading 7% higher today.
The DAO team could join the SailGP lineup as soon as Season 4 in 2023. Members of the DAO will be able to determine athlete selection, team management and team strategy.
Arctos Sports Partners Grows MLB Portfolio to Six Teams - Front Office Sports - March 17th, 2022
Arctos Sports Partners has quietly built up its baseball portfolio with stakes in some of the most valuable MLB teams.
The private equity firm reportedly holds stakes in five teams, in addition to a minority stake in Boston Red Sox owner Fenway Sports Group.
Recent reporting has also revealed its stakes in the following teams:
Los Angeles Dodgers, valued at $3.6 billion last year, per Forbes (2nd in MLB)
Chicago Cubs, $3.4 billion (4th)
San Francisco Giants, $3.2 billion (5th)
Houston Astros, $1.9 billion (12th)
San Diego Padres, $1.5 billion (17th)
The Red Sox have the league’s third-highest valuation at $3.5 billion.
MLB has allowed private equity investments in teams since 2019. Teams can sell up to 30% of their equity, and individual funds can own up to 15% of a team.
Report: Gene Haas to increase F1 team investment - Sports Pro Media - March 15th, 2022
Gene Haas, the founder of Haas Racing, is set to increase his investment in the US-based Formula One team.
Haas have been the team in the global motorsport series most-impacted by the crackdown on Russia-based investors, following the country’s invasion of Ukraine. The team cancelled their title sponsorship deal with Uralkali, the Russian fertiliser company part-owned by Dmitry Mazepin, the father of recently-fired driver Nikita Mazepin.
According to Racer, the increased funding from the team’s owner is one option to fill the gaps left by that lost sponsorship revenue, with the team’s sales department also continuing to look for replacement backing from new or existing partners.
U.S. Investment Firm Buys Belgian Soccer Club Standard Liege - Bloomberg - March 11th, 2022
U.S. investment firm 777 Partners LLC acquired Belgian soccer club Standard Liège, deepening its bet on what it considers undervalued sports assets in Europe.
The Miami-based firm bought a controlling stake from Bruno Venanzi, co-founder of energy company Lampiris and club president for the past seven years, Standard said Friday in a statement on its website. Terms weren’t disclosed.
“777 Partners is delighted to take up this new challenge to help the club continue its development and regain its former glory,” said Standard, which won the last of its 10 Belgian league titles in 2009.
The transaction comes with soccer, where profitability is a rarity, at something of a crossroads. The sport’s elites are pushing for ever greater returns after trying last year to put together a league of the richest clubs in a largely closed competition. Smaller clubs are getting squeezed and struggling to remain competitive on and off the field.
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