The new money on Wall Street – private credit – wants to score big on European sports investments. Last week, Nottingham Forest took out an £80m loan from asset management giant Apollo Global Management, which is reportedly also in talks to take a stake in Atlético Madrid.
It is joining its private capital counterparts in an arena previously dominated by banks. Recent announcements from Ares Management and CVC Capital Partners demonstrate an appetite for what they consider an undercapitalised market: sports.
These firms see long-term stability in injecting money into leagues with loyal fans and few business competitors. Last week, Apollo declared plans to launch a “permanent capital vehicle” for sports finance, allowing the booming £500bn firm to take equity positions in professional franchises. Their aim is to help teams and leagues grow and gain capital through longer-term loans.
Meanwhile, Ares has proposed a “new media and entertainment fund designed for individuals, a departure from the traditionally exclusive nature of sports finance”. This fund is its second focused on sports after closing its first in 2022 at $3.7bn.
Despite recent changes in sports financing regulation – notably in baseball and football – there remains a rigorous approval process for private equity firms, noted Jim Miller, co-head of sports, media and entertainment at Ares.
“There’s a very real moat that exists around getting access to this market. An institution can’t just show up and start investing without support from the league and team owners,” Miller said.
As Apollo expands into European sports, it is also taking stakes in some of the continent’s other industries, such as nuclear power and pensions. Its reported investment in Ares-backed Atlético Madrid would be part of an €800m infrastructure deal around the club’s stadium.
Backing sports is more established at Ares. Deals since 2007 include over $400m in financing to Olympique Lyonnais, the largest takeover in French football, and a 10% stake in the NFL’s Miami Dolphins. According to its projections, the total investment opportunity in such “adjacent strategies” could be worth $2.5tn.
Long established across Formula One, Spain’s La Liga and rugby leagues and tournaments, CVC, as revealed by Sky last week, plans to refinance its £9bn-plus sports portfolio.
A new entity, named SportsCo, chaired by former EE chief Marc Allera, will group together CVC’s sports investments to capitalise on the powerful consumer base that is sports fandom and bring in new revenue streams.
The new sports investment platform will drive commercial appeal through fan engagement, new forms of media and sponsorship, seeking to corner a slice of this rapidly developing market, as well as the potential prize of investment from the Gulf sovereign states.
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