I wrote earlier in the week about the potential sale of
West Ham United, and cited some reported investors including from the US.
One of the most intriguing developments is the emergence of Apollo Global Management, a Private Equity (PE) giant with $840 billion in assets under management. Under the leadership of Al Tylis, Apollo recently launched Apollo Sports Capital, a dedicated sports investment strategy.
Apollo has already deployed $17 billion into sports and entertainment, including a $107.47 million senior loan to refinance Nottingham Forest’s debt and there are reports of interest in acquiring a stake in Atlético Madrid
Their key focus will be on debt and hybrid capital investment opportunities, a model that aligns with the financial needs of many clubs.
Football finance expert, Kieran Maguire believes that if the US has a good World Cup it could stir up the appetite of PE Investment into English clubs. He did exercise caution though and stated a year ago that Private Equity firms are focussed on money and return rather than football.
In the Premier League alone, a number of clubs have Private Equity involvement including Liverpool (Dynasty Equity), Manchester City (Silver Lake), Chelsea (Clearlake Capital).
Events at Manchester United suggest Private Equity involvement is a double edged sword
Across Europe’s top five leagues, over 36% of clubs now have backing from private equity, venture capital, or private debt firms. Notably, US investors account for 40% of these deals. Private equity pools money from limited partners, buys businesses, cut costs, boosts enterprise value and sells on for a return.
West Ham aren’t strangers to this, as Daniel Kretinsky’s 27% stake is held via 1890 Holdings, a sports investment platform which functions as a private equity style holding entity.
West Ham continue to draw interest from potential investors. EXWHUemployee confirmed that some visited the club’s training ground facilities back in September. In parallel, the club has been engaged in discussions with Monarch Collective—a U.S.-based private equity firm about acquiring a 49% stake in the women’s team.
If momentum persists, significant developments by next summer appear not only feasible, but increasingly likely.
Perhaps David Sullivan will semi-retire and pass on to Jack, so there will be a change of approach towards the future.
I should have asked the simple question, whether to your knowledge Matt a PE company would say, buy the 25% stake holding of the family Gold and then be a member of the board without governing and taking all decisions, whilst injecting money to create change? Maybe, if other board members put in similar amounts perhaps?
Thanks for an interesting article – sorry for all the questions!
honest questions:
Would n’t PE investment companies want a majority holding, or guarantees of change in order to invest with the stated aims of reducing costs, boosting enterprise value in order to resell for a profit?
Also, is it not like flipping a coin, whether the PE company will be beneficial or detrimental to WHU, depending on how they aim to boost enterprise value?
Will envisaged PSR changes finally make for a more even playing field by clipping the wings of the mega buck teams? So then, smaller clubs can compete?
Sorry for all the questions – they are honest questions and plus I’m wary at just how often, throwing wads of cash at something has unexpected, detrimental consequences.
Maybe I’m small time, but not sure I want bags of cash, new manager, new players, like Man City. Is more and more money coming in what we want, when millions go to players , agents and managers while long term devoted fans get priced out of attending?
I’d like running changes in how recruitment is handled, managers appointed, improved facilities for all teams, modifications to the LS and ticket prices, but with time, with a plan in place and so on. Growing rather than a leap of faith with PEI companies who might promise big time champions league, because then they’ll make more money and then move on.
Something needs to happen, Matt, the half empty Soulless Bowl will be a sorry site with
the likes of Blackburn and Preston visiting next year – so sad, fans don’t deserve what is happening to our club.