Private equity and venture capital-backed transactions are the highest they have been in eight years, according to S&P Global. Haynes Boone Denver Office Managing Partner Dan Malone spoke with the publication about the high valuations and what they mean for the sports industry as a whole.
Read an excerpt below.
"The valuations [are] getting so incredibly high and frothy that select few can invest. There are rules on the amounts and thresholds that they can invest. It creates a very closed market," Dan Malone, co-head of M&A and private equity at law firm Haynes Boone, said in an interview.
Malone said private equity investments in sports teams tend to be exclusive to elite firms, given the high valuations and specific investment rules. …
"Even in down economies, you see folks investing discretionary income into these live experiences, which create opportunities on the margins for things like food and beverage sales, merchandising and other adjacent services that are around focused on the stadium," Malone said. …
Malone expects more deals in leagues such as women's professional soccer.
"There are new cities and franchisees that are popping up, looking to capitalize both on the otherwise exclusive direct ownership that some of the established leagues have already had, but also on all important ancillary adjacent," Malone said.
Read the full S&P Global article here.
