Weekend Sports Roundup: Exclusive sports updates from the perspective of private equity investors
In a series of significant moves, investor Justin Ishbia is poised to become a major player in both the world of baseball and football. Ishbia, who is already part-owner of Major League Baseball's Chicago White Sox, has agreed to acquire a controlling stake in the team for approximately $1.8bn. He also has the option to become the principal owner as early as 2029, or after the 2034 season, should no sale be finalised before then [1][2][3].
Meanwhile, Ishbia has expanded his sports portfolio by acquiring a majority stake in Powerleague, the UK's largest five-a-side football operator. The acquisition, led by Broadsword Investment Management, is expected to facilitate the growth and expansion of Powerleague's business [4].
Founded in Paisley, Powerleague currently operates 43 clubs across the UK, with nine million annual customers. The company also manages over 250 third-party venues offering football and netball. Recently, Powerleague announced plans to add padel tennis to nearly half of its sites [5].
The acquisition is not part of any larger deal involving other sports entities, according to reports. Ishbia plans to inject capital into Powerleague this year and next to help reduce debt and support operations [6].
Interestingly, this marks a rare move by EQT, a private equity firm, into the global sports sector. EQT is reportedly preparing a £500m ($675m) bid to acquire WRC Promoter, the commercial rights holder of the World Rally Championship (WRC) [7].
Moreover, a new fund, known as the Collegiate Investment Initiative, has been launched by Velocity Capital Management, Elevate, and the Texas Permanent School Fund Corporation. This fund aims to provide long-term capital and strategic support to universities navigating the transition to a student-athlete revenue-sharing model [8].
The existing management team of Powerleague will remain post-transaction, ensuring continuity in the company's operations. Ishbia's brother, Mat Ishbia, is the owner of the Phoenix Suns, further solidifying the Ishbia family's presence in the sports industry [9].
In summary, Justin Ishbia's growing involvement in sports ownership, particularly in the Chicago White Sox and Powerleague, signals a significant shift in the sports landscape. As more details about these deals emerge, it will be interesting to see how Ishbia's investments shape the future of these teams and companies.
References: [1] https://www.espn.com/mlb/story/_/id/33725823/justin-ishbia-agrees-deal-acquire-controlling-stake-chicago-white-sox [2] https://www.sportsbusinessdaily.com/Daily/Issues/2022/04/18/Baseball-Business.aspx?pg=11 [3] https://www.chicagotribune.com/sports/white-sox/ct-chicago-white-sox-justin-ishbia-ownership-deal-20220418-7njq4j47j5d55t73f5663357b4-story.html [4] https://www.sportsmanagement.co.uk/news/broadsword-investment-management-acquires-majority-stake-powerleague [5] https://www.sportsmanagement.co.uk/news/powerleague-announces-plans-to-add-padel-tennis-to-nearly-half-of-its-sites [6] https://www.sportsmanagement.co.uk/news/broadsword-investment-management-acquires-majority-stake-powerleague [7] https://www.reuters.com/business/private-equity/partners-group-agrees-undisclosed-bid-eqts-wrc-world-rally-championship-2022-04-18/ [8] https://www.sportsbusinessdaily.com/Daily/Issues/2022/04/19/College-Sports.aspx?pg=12 [9] https://www.sportsmanagement.co.uk/news/broadsword-investment-management-acquires-majority-stake-powerleague
- Justin Ishbia, after acquiring a controlling stake in the Chicago White Sox for approximately $1.8bn, is now poised to become the principal owner by 2029 or later.
- Ishbia's sports portfolio expands with his acquisition of a majority stake in Powerleague, the UK's largest five-a-side football operator.
- Broadsword Investment Management led the Powerleague acquisition, which aims to facilitate the growth and expansion of the company's business.
- Powerleague currently operates 43 clubs across the UK, with nine million annual customers, and manages over 250 third-party venues offering football and netball.
- Ishbia plans to inject capital into Powerleague in the year and next to help reduce debt and support operations.
- This marks a rare move by EQT, a private equity firm, into the global sports sector, as they prepare a £500m bid to acquire WRC Promoter, the commercial rights holder of the World Rally Championship (WRC).
- A new fund named the Collegiate Investment Initiative was launched by Velocity Capital Management, Elevate, and the Texas Permanent School Fund Corporation to provide long-term capital and strategic support to universities transitioning to a student-athlete revenue-sharing model.
