Owners Club Newsletter - March 21st
Jordan selling Hornets stake, SVB Bailed Out, and continued investment into women's sports highlight this edition of Owners Club by FanClub Sports
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News & Highlights:
Silicon Valley Bank, Signature Bank Depositor Bailouts Save Sports Industry from “Dire” Consequences
SailGP expansion team seeks $35 million with tokenized fan offering
Report: Michael Jordan in talks to sell Charlotte Hornets majority stake
Report: MLB plans to stream games for free as Diamond Sports bankruptcy nears
WTA secures minority sale to CVC Capital Partners, valued now at $750M
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Recent Sports M&A News and Developments
Silicon Valley Bank, Signature Bank Depositor Bailouts Save Sports Industry from “Dire” Consequences - JohnWallStreet - March 16th, 2023
The recent collapse of Silicon Valley Bank, the second largest in U.S. history ($42 billion), and the subsequent failure of Signature Bank, the third largest all-time, have sparked fears of bank runs at other regional banks.
“The first order effect would [have been] that those PE funds that custodied assets with SVB would be unable to deploy their dry powder into deals," Dave Mirynech (founder, FanClub Sports Capital) said. "The second order effect [would have been] that many of the LPs in VC funds custodied with SVB are clubs and owners, and they may have faced a near-term capital call as those funds struggled to make payroll. The third order effects [would have been] the liquidity crunch brought about by the first two [and their impact] on daily club operations. [And] the reality is that in the aftermath, we probably would have seen a freeze on deal-making in the sports capital market ecosystem for some time."
SailGP expansion team seeks $35 million with tokenized fan offering - Sportico - March 16th, 2023
An expansion franchise in SailGP, the three-season old Larry Ellison-led boat racing league, is seeking to raise $35 million in a tokenized fan offering that launched this month.
The new, to-be-named team will be the 10th in the catamaran circuit, representing the Caribbean and Bermuda. The raise should be enough to both pay a $15 million expansion fee to the league and fund racing operations for its first two seasons. The man leading the effort also believes its structure can serve as a template for established leagues to increase liquidity for limited partners and perhaps lower the threshold for new minority owners to buy in.
Report: Michael Jordan in talks to sell Charlotte Hornets majority stake - SportsPro Media - March 16th, 2023
Michael Jordan is in talks to sell a majority stake in the Charlotte Hornets to a group led by the National Basketball Association (NBA) franchise’s minority owner Gabe Plotkin and Atlanta Hawks investor Rick Schnall, according to ESPN.
A deal is reportedly not imminent but ESPN states there is ‘significant momentum’ for the sale, which would eventually lead to Plotkin, the founder of Melvin Capital, and Schnall, a minority owner of the NBA’s Hawks, becoming co-governors of the Hornets.
Report: MLB plans to stream games for free as Diamond Sports bankruptcy nears - SportsPro Media - March 14th, 2023
Major League Baseball (MLB) could stream the games of roughly six teams for free as part of the fallout from Diamond Sports Group’s looming bankruptcy, according to the New York Post.
MLB commissioner Rob Manfred previously confirmed that the league would “step in” to air games if Diamond files for bankruptcy, and it now appears that the organization is planning to do so for free.
Utah Royals Become NWSL’s 13th Team - Front Office Sports - March 13th, 202
The Utah Royals are officially returning to the NWSL.
The league, Smith Entertainment Group, and Global Football Holdings announced that the team will begin play in 2024 as the league’s 13th team — four years after it was acquired and moved to Kansas City to become the Current.
When the team moved, its MLS counterpart Real Salt Lake kept the rights to the team name and branding with the ability of bringing it back in 2023 or 2024 for a predetermined fee, reported to be between $2 million to $5 million.
Everton Won’t Be Sold Despite Several Reported Offers - Front Office Sports - March 9th, 2023
Everton likely won’t be sold anytime soon.
Farhad Moshiri has reportedly received several offers for the Premier League club but has decided not to sell over concerns it could attract scrutiny from the U.K. government.
Moshiri claimed in January that the team was not for sale, but that he was close to securing a minority investment to help fund a new stadium expected to cost around $596 million.
MSP Sports Capital and 777 Partners have been reported as potential investors.
WTA secures minority sale to CVC Capital Partners, valued now at $750M - Sports Business Journal - March 7th, 2023
The WTA confirmed the “sale of a 20% stake” to CVC Capital Partners in a deal that “values the organization" at $750M, according to Mark Kleinman of SKY SPORTS.
The “strategic” partnership, which has been “under discussion for close to two years, will involve the establishment of a new company overseeing broadcasting and marketing operations.” CVC’s investment will “aim to accelerate the commercial opportunities.”
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