Man City owner sells US$500m stake to Silicon Valley private equity firmBusiness | 27 Nov 2019 7:01 pm
Manchester City's Abu Dhabi-controlled owner has agreed to sell a US$500 million stake to U.S. private equity firm Silver Lake, making it the world's most valuable soccer group with a US$4.8 billion price tag, Reuters reports.
Tech-focused Silver Lake will buy just over 10 percent of City Football Group, which owns reigning English Premier League champions Manchester City and teams in the United States, Australia and China, the companies said today.
The investment crowns a rags to riches story for Manchester City, which spent much of the 1990s in the doldrums but broke into the big league of world soccer with the help of Middle Eastern cash.
Chinese investors paid US$400 million for a 13 percent stake in CFG four years ago, valuing the group at US$3 billion at that time.
Man City's big domestic rival Manchester United are majority owned by the American Glazer family and are valued at US$2.8 billion.
Chelsea are owned by Russian billionaire Roman Abramovich, while America's Fenway Sports Group controls current European champions Liverpool and French champions Paris Saint Germain are owned by Qatar Sports Investments.
"We and Silver Lake share the strong belief in the opportunities being presented by the convergence of entertainment, sports and technology and the resulting ability for CFG to generate long-term growth and new revenue streams globally," CFG Chairman Khaldoon Al Mubarak said.
CFG, which also owns or part owns New York City FC, Melbourne City FC, Yokohama F. Marinos in Japan, Club Atletico Torque in Uruguay, Girona FC in Spain and Sichuan Jiuniu FC in China, said none of its shareholders were selling stakes.
Abu Dhabi United Group, the investment vehicle owned by Sheikh Mansour bin Zayed Al Nahyan, will remain the majority CFG shareholder with a stake of around 77 percent after the deal.
It is relatively rare for private equity firms to buy into soccer because they want a relatively quick return and while clubs make their money from lucrative broadcasting rights, their fortunes still depend on their success on the field.
Silver Lake Managing Director Egon Durban, who will join CFG's board, said the California-based firm's investment would "help drive the next phase of CFG's growth in the fast-growing premium sports and entertainment content market".
Silver Lake owns stakes in entertainment and sport talent agencies group Endeavor and global sports agency IMG.