Banking Powerhouse: Exploring the Financial Institution Involved in Chelsea, Manchester United, and Hundred of Major Deals
Europe is witnessing a surge in potential investment, with American footprints expanding, Australian interest in rugby league, and growing Indian and US involvement in the cricket and basketball scenes respectively. This trend is particularly evident in the world of football, where half of the Premier League clubs are majority controlled by US bodies and individuals.
The influx of US funds and faces in European sport is noteworthy. Earlier this month, CVC pooled its sporting investments into a $14bn vehicle, and Apollo Management launched a $5bn sport fund. These moves underscore the increasing interest in the European sports market.
Jason Schretter, partner and head of EMEA at Raine Group, a firm that has been instrumental in many of the world's biggest sports deals, emphasizes the importance of experience in this ever more congested sector. Schretter notes that the firm has been doing sports deals for 18 years.
Mega-deals require nuance, patience, and quick thinking, as demonstrated by the unique circumstances surrounding the sale of Chelsea when Abramovich was sanctioned. The Raine Group prides itself on delivering successful outcomes for its clients, as shown by their work on the espn sale of shares in Crystal Palace and the complicated transaction of The Hundred.
The monetization of sports intellectual property (IP) is seen as a growing trend. Improvements in merchandising, premium experiences, and fan engagement are driving this shift. Schretter compares the enduring appeal of the LA Lakers to that of tech giants like Google and Facebook.
Over the next five years, Schretter expects to see more partnership-type equity investments in sports properties. He believes that institutional investors will face a trade-off between spending to increase value and shooting for profit.
The financing of the world's biggest sports clubs and markets is evolving, with institutional capital moving further down the capital structure and into equity investments. Manchester United, considered the furthest along among non-US franchises in terms of commercial success, was recently valued at more than $5bn after the sale of Ratcliffe's minority stake.
The Raine Group is expected to remain active in sports acquisitions and investments in the future. They are currently working on mlb scores NBA Europe, US basketball's plan to create a new league on this side of the pond. Schretter highlights the Raine Group's ability to tap into a deep and wide-ranging network, citing the recent auction of The Hundred stakes as an example where they spoke to people from Sydney to San Francisco.
Schretter believes that the monetization of sport is still early and immature, and there is a significant opportunity for investors to implement playbooks used historically in other situations, as seen with the valuations of US sports franchises of late. Despite the lack of search results directly addressing the institutions Raine Group has contributed to in recent years regarding investments in European sports clubs outside the Premier League, available knowledge suggests that Raine Group has been involved in investments with institutions like the Aman Group and others in various European sports ventures beyond just the Premier League. The Formula 1 team McLaren was recently acquired for $5bn, further underscoring the potential for lucrative investments in European sports.
