Unintended Empire: John Henry’s eclectic sports portfolio

Picking at his lunch in a home-plate suite in Fort Myers, Fla., ahead of a partners meeting Fenway Sports Group hosts each spring training, Boston Red Sox principal owner John Henry paused a story mid-sentence to ponder for a beat, then another and another.

Describing an unlikely turn in his convoluted quest to buy the Red Sox 25 years earlier, it occurred to Henry that almost all of the teams he has pursued in the course of building a $14 billion sports conglomerate came with an odd, often gut-wrenching series of plot twists.

Like the time he bounced gleefully in the restroom of a Manhattan restaurant after making a handshake deal to buy the Florida Marlins for $150 million, only to be told the next morning that the price had gone up.

Or when his sidetracked negotiation to sell those Marlins and buy the Angels three years later evolved to include discussions of an unprecedented, and to others unfathomable, swap of about 100 players from each team’s farm system.

When his lawyer interrupted his New Year’s Eve in the Caribbean to tell him his $700 million deal to buy the Red Sox was in peril unless he included a perpetual batch of free front-row seats.

Or when he had to wander off a tour of Liverpool FC’s Anfield Stadium to find out that the fabled structure the previous owners intended to level was not, in fact, crumbling on all sides.

“I always refer to it as high levels of strangeness,” said Henry, a former hedge fund manager and futures trader who, in the last quarter-century, has acquired the Red Sox, Liverpool FC and the Pittsburgh Penguins; taken a 50% stake in a NASCAR team; and delivered a shape-shifting $3 billion investment in the PGA Tour. “That was a quote by Dr. J. Allen Hynek, who studied what he called swamp gas. He said in close encounters of the third kind, they always exhibited high levels of strangeness. And that has been my experience buying teams.”

That Henry would quote an astronomer best known for his research into UFOs to describe those purchases, as well as his short-circuited attempts to buy a few other teams, is reflective of the eclectic nature of his interests.

He adores baseball, and the numbers that populate it. He also is fascinated by cosmology and small particle physics, sciences integral to understanding the origin of the universe. He has a recording studio in his Boca Raton, Fla., home. He came to cigar smoking relatively recently, but already has amassed more than he ever will smoke, guided by a now encyclopedic knowledge of their flavor profiles and the regions in which they’re grown.

Henry’s rare combination of high intellect, operational aptitude and boundless curiosity has led to a string of on-field success — four World Series trophies for the long-cursed Red Sox, and two Premier League titles and a Champions League title for once-moribund Liverpool — as well as escalating revenue and soaring franchise values.

“He’s one of the most respected owners in baseball,” said Tom Werner, Henry’s close friend and long-running partner in FSG, who met him shortly before they bid together on the Red Sox. “When John speaks, people listen to him, because he has something to add to the conversation and he’s thoughtful. He’s not always on the same side as others. But there’s an enormous respect for his point of view.”

“He has a great intellect; really, really smart,” said MLB Commissioner Rob Manfred, who has steadily entrusted Henry with key leadership roles, as did his predecessor, Bud Selig. “And he puts the time in to understand the details. As a result of the combination of those two things, people do look to him for leadership.”

“He’s not somebody that comes into a meeting and tries to take it over,” said Jerry Reinsdorf, the Chicago White Sox owner who mentored Henry when he came into the league. “He’ll listen and soak it up. But when he’s ready, he will express his opinions. And they’re usually pretty good because he’s smart. He’s just overall smart.”

Neither Henry’s intellect nor his approach guarantees evergreen success for his teams. He was reminded of that in the first month of this baseball season, as the Red Sox deflated the optimism he expressed while watching exhibition games in Fort Myers.

They were on their way to losing the eighth of their first 10 games when a Fenway crowd chant of “Sell the team!” wafted up to his suite. A video circulated on social media captured his initial surprise, followed by apparent resignation. On April 25, the Red Sox fired manager Alex Cora. Since winning their fourth World Series under Henry in 2018, they have made the postseason twice in seven tries.

“Fans get frustrated,” Henry said by email last week. “The Sox looked terrible for (their) first 25 games. I remember a plane flying overhead when we (Liverpool) were beating Manchester United 7-0 that read ‘FSG OUT!’”

“It doesn’t mean you ignore them, it means you work harder – you don’t settle for mediocrity. You have to win."

Though Henry knew he wanted to buy a pro team from the moment he realized he could, Henry never intended to own more than one. That was driven by economics, and the realization that scale and diversity gave him the best chance at sustained success.

Those who work for him and invest in his sports holdings know that the ultimate litmus test for whether FSG pursues a property is not its balance sheet, but whether he is convinced that it, as longtime suburban Boston neighbor and FSG partner Mike Gordon describes it, “truly matters to people.”

“We don’t think in terms of investment when we’re getting involved in something,” Henry said. “You only have so much time on the planet. So you get involved in something because you want to be involved.”

Dealing for the Marlins, Red Sox

Wrapping up a memorable dinner with friend Rick Rochon in August 1998, Henry excused himself and headed to the restroom where, finally alone, he allowed himself a brief release of the glee that had been building all evening.

He jumped up and down.

“I own a Major League Baseball team,” Henry thought to himself, letting it sink in.

He’d started down this path earlier in the summer, when a group short on cash invited him into a deal to buy the Florida Marlins, the ballclub that owner Wayne Huizenga had stripped down to its studs after winning the ’97 World Series. A devout baseball fan who leased a suite behind home plate for Marlins games, Henry contacted Rochon, who ran the Huizenga-owned holding company that also included the Miami Dolphins, the Florida Panthers, the stadium that the Dolphins and Marlins shared and a statewide RSN.

Rochon suggested Henry bid on his own.

It wasn’t the first time he’d tried to buy a South Florida sports franchise. When the NHL awarded an expansion team to Huizenga in 1992, Henry was among the bidders. He was part of a group that pursued the Dolphins a year later, again losing out to Huizenga.

But his passion was baseball. He’d owned the Class AAA Tucson Toros for a decade and spent an amusing season as co-owner of the West Palm Beach Tropics, the best team in the Senior Professional Baseball Association, an ill-fated amalgam of retired major leaguers that included Rollie Fingers, Al Hrabosky and Mickey Rivers. While a hoot, the league wasn’t financially viable. Henry and his partner sold at a loss ahead of its collapse. He then bought a 1% share in the New York Yankees.

Henry took his first swing at a more substantive stake in an MLB club soon after his senior league team folded, when two other team owners invited him to take the largest share in a group bidding for an expansion franchise in Denver. Henry was enthused until a public spat with the governor, who favored local ownership. He said that experience led him to stay out of the bidding when the team of his boyhood, the St. Louis Cardinals, were put on the block in 1995.

“I was thinking, ‘I don’t ever want to be in the newspaper,’” Henry recalled. “You try to avoid that if you’re a money manager.”

He changed his mind when the club that was for sale was a 40-minute drive from his home.

Henry offered Huizenga $135 million. When that was rejected, he quickly went up to $150 million.

When he met Rochon for dinner, they were apart on two significant deal points. Henry still was $15 million short of what Huizenga was asking. And he was unwilling to sign an unfathomable 27-year rights deal that Huizenga hoped to use to boost the price of the RSN he was selling.

When Rochon said Huizenga would take the $150 million and reduce his rights demand to a dozen years, Henry agreed, and they shook hands.

But the next morning, Rochon phoned with news that Huizenga also wanted another $8 million to cover stadium improvements. Henry was incensed. He thought it might be a negotiating ploy. But as the next two weeks unfolded, the tenor turned increasingly contentious.

As verbal shrapnel flew between Henry and Huizenga, Marlins GM Dave Dombrowski, fresh off signing a five-year contract extension with the understanding that Henry would purchase the team, went to Henry’s suite to try to salvage the sale.

“Sometimes when you want a player, you gotta pay up,” Henry recalled Dombrowski saying. “So I would say in this case, you need to just pay that $8 million and close the deal and move forward.”

Henry and Huizenga mended fences and agreed to terms, but the deal wasn’t done. Henry was in San Diego watching the Yankees win the World Series when Rochon phoned to say Huizenga wanted to change the cable agreement. They haggled for another two weeks until, hearing that Henry had called a press conference to announce he was withdrawing his bid, Huizenga relented.

John Henry owned a major league team.

He set out to restore a bruised fan base and massage public funding for a desperately needed new ballpark that Huizenga had been unable to land.

Though Marlins fans likely preferred Henry to his predecessor, it didn’t translate at the gate. Attendance declined for the second of what would be five consecutive years, including all three that he owned the club, ranking behind all but Montreal in the National League.

He also didn’t fare any better on ballpark funding than Huizenga had.

Henry started out with high hopes. He dove into location studies, design plans and financing options. Still convinced they could land public funding by positioning a downtown ballpark as a community asset, he invited the team of consultants and lobbyists he’d hired to push the project to his home for a screening of the classic film “Mr. Smith Goes to Washington,” which featured Jimmy Stewart as an idealistic U.S. senator who prevails over corruption.

“John was sending a message to people that were working on this transaction that we’re going to do this the right way; the honest way,” said David Ginsberg, a longtime friend of Henry’s who relocated to Boca Raton to help him with the hedge fund and serve as vice chair of the Marlins. “It was a reflection of where we found ourselves and how we were going to proceed.”

After failing on their first try at state funding, the Marlins struck a deal that included county funding and a tax rebate from the state that required legislative approval. Though thorny, the measure sailed through the House. It died on the floor of the Senate without a vote.

Ginsberg remembers standing, stunned, in a Capitol building doorway. He thought they had enough support to carry narrowly if it reached a vote. Henry was in his seat at the ballpark when he got the bad news minutes later from the editor of the Miami Herald, who was watching the game next to him.

“I was shocked,” Henry said. “Two years in a row, all it took was one person in Florida to kill everything.”

Henry was done.

Days later, he headed to New York to tell MLB President Paul Beeston and chief lawyer Bob DuPuy that he “wanted out.” DuPuy tried to settle him, telling him then-Commissioner Selig wanted him in the game. Without a ballpark plan, the Marlins’ future was tenuous. Momentum was building to contract two or four teams, so much so that “contraction is action” had become a mantra.

They suggested he consider a bid for the Red Sox. When Henry said the team’s sale process felt too much like an auction, they suggested the Disney-owned Angels, another club that was on the block.

He lived in Orange County for about 25 years before moving his JWH offices to Connecticut and then Boca Raton. He’d be going home. Henry met with Angels President Tony Tavares and had dinner with Disney CEO Michael Eisner.

They started off about $30 million apart on price, Henry recalled. It might have been bridgeable, but other factors complicated matters. The way Disney allocated RSN revenue short-changed the Angels. The Angels also were committed to a fat contract for declining star Mo Vaughn.

When Dombrowski told Henry he thought the Marlins were set up to win sooner than the Angels because of the prospects he’d acquired when Huizenga stripped them down, Henry suggested they ask to swap farm systems as part of the deal.

“Probably not going to happen, but we were working on it,” Ginsberg said. “When I say John thinks outside the box, I mean outside the box.”

As months passed with little progress, Henry grew pessimistic. Walking along the lake of his Boca Raton estate on a Saturday afternoon in October, he decided to check in with Larry Lucchino, the former Padres and Orioles president who befriended him after he bought the Marlins. It was Lucchino whom Selig dispatched to Miami to advise him on his quest for a stadium. Lucchino was helpful again when Henry decided to look at the Angels, joining him on a tour of their Anaheim ballpark.

“I would go out and spend time with owners, but the most enlightened guy I found was Larry,” Henry said. “I remember thinking, ‘We really ought to work together some day.’”

After advising on both Henry’s negotiations in Anaheim and former Padres owner Tom Werner’s bid for the Red Sox, Lucchino had decided to join Werner’s group. He was at a Yale-Brown football game when Henry called to ask how that deal was progressing.

“We’re dialing for dollars,” Lucchino told him.

“You think there’s room for me in your group?” Henry asked.

“You’re absolutely the guy we’re looking for,” Lucchino replied. “Baseball acceptability and deep pockets.”

At Lucchino’s suggestion, Henry traveled to L.A. to meet Werner, checking into a bungalow at the iconic Beverly Hills Hotel, where they met for dinner.

“We hit it off instantly because we have the same sort of point of view about sports: that it has to be sustainable,” Werner said. “And we both were excited about the Red Sox. It was very different from being involved in San Diego and Miami.”

“Tom and I became best friends — I mean best friends — early on,” Henry said. “And Larry was so qualified to run the Red Sox that it was perfect. I can’t imagine anything better. It was magic from the beginning. You had three guys who really were immense baseball fans. And we were going to, in our minds, what was the crown jewel of the league.”

When he got home to Florida, Henry phoned DuPuy, who’d been working to smooth the Angels negotiation.

“I hope you’re sitting down,” Henry began.

Werner, Lucchino and ski resort operator Les Otten already had submitted a list of investors in their group and their financing sources to Red Sox CEO John Harrington, who ran the bidding process on behalf of the Yawkey estate, the team’s controlling owner. Henry’s information would be added, but his identity kept secret in deference to MLB, since he still owned the Marlins. The papers — even those held by Bank of America, which approved a $200 million loan to the group — referred to him only as “Investor No. 11.”

“More strangeness,” Henry says as he recounts it now, laughing softly and shaking his head.

On Nov. 29, 2001, Harrington and representatives of the estate opened the bids of six groups vying for the 54% of the team held by the Yawkey Trust, a 12-acre parcel that included Fenway Park and 80% of regional sports network NESN. Harrington, the directors of the trust and the limited partners holding the remaining shares of the team would decide the buyer based on the bid and the likelihood they would be approved by MLB.

The highest bid was reported to be $405 million, submitted by Cablevision scion Charles Dolan, owner of Madison Square Garden and its teams. It was said to be at least $30 million more than the others, including Henry and Werner and local favorites Joe O’Donnell and Steve Karp.

That could have been the end of it. But the week that followed brought more strangeness. Fearing that the trust might take one of the lower bids, Dolan floated word that he’d also be willing to pay a premium for the limited partners’ shares. Faced with a clear conflict of interest for the limited partners, whose consolidated votes could determine the winning bid, Harrington reopened the process.

He gave the other groups 10 days to resubmit offers for full ownership of the team, for which Dolan reportedly had offered $695 million.

Like Dolan, Henry worried that the romance of local ownership might land O’Donnell and Karp the team. But he also suspected that they would be hard-pressed to come up with the money to increase their bid. He asked Selig to encourage Harrington to allow them to talk about combining their groups.

When Harrington agreed, the talks began. Henry thought they had a deal when, while working into the night at his lawyers’ New York offices on the eve of the bid deadline, O’Donnell and Karp called to say they were out.

Working until nearly dawn with Werner, who arrived in New York late after a White House dinner with then-girlfriend Katie Couric, they restructured the bid to replace O’Donnell and Karp’s expected commitment. They boarded Henry’s plane to Boston, where they submitted a $700 million offer.

They were stewing in a Boston hotel suite when they learned that their bid had prevailed, hearing from their lawyer only minutes before Harrington made the announcement at a press conference they watched from the room.

Even after that, there was more “strangeness.” The losing bidders accused MLB of improperly influencing the auction, steering the team to Henry and Werner at the expense of the charities that would benefit from the trust. The Massachusetts attorney general opened an investigation into the sale. Dolan tried to bid again.

Henry said the absurdity reached its peak on New Year’s Eve, when his lawyer phoned him in the Caribbean with Harrington’s lawyer on the other line. The Yawkey group had front-row seats that they wanted to keep as part of the deal. But they didn’t want to pay for them. When Henry explained that he, too, had partners who wanted front-row seats, Harrington’s lawyer suggested the deal could fall apart if he didn’t relent.

They reached a compromise that allowed the previous ownership group to keep the seats, but pay for them.

In Boston the next day to discuss potential Fenway Park renovations with ballpark planner Janet Marie Smith, Henry asked about adding a row or two of prime seats on the field. Smith explained that they could do one, but that a second would block the view from the old front row.

“I said, ‘Let’s do two,’” Henry said. “So we did two.”

Branching out

Soon after closing on the team, Henry began the hunt for a home for his family, which would be relocating from Florida. Focusing on neighborhoods to Boston’s west, he had to drive by Fenway along the way.

“Instead of going inside (Fenway), I’m looking for houses,” Henry said. “It was like a huge magnet. I just wanted to be there.”

The Red Sox’s performance on the field and off quickly exceeded expectations.

They were in the ALCS in their second season and won the World Series in their third, breaking a well-documented 86-year drought. They won it again in 2007, then in ’13 and ’18, giving them the most championships of any team during that span. They reimagined Fenway in ways that turbocharged revenue while preserving its iconic identity.

The FSG conglomerate has its roots in a conversation Henry had with corporate sales head Sam Kennedy, then-COO Mike Dee and a few other Red Sox executives after their first World Series win. Demand was outstripping supply in everything they sold.

“You guys are doing too good of a job,” Kennedy, who is now CEO of the Red Sox and FSG, recalled Henry telling them. “You better think of what’s next or you’re going to work yourselves out of a job here.”

Dee took it as a challenge to be more entrepreneurial. If they were running out of their own inventory to sell, perhaps they could build a business doing it for someone else.

They started with a deal to sell advertising for MLB Advanced Media. They took on commercial responsibilities for the athletic department at Boston College. They represented the Professional Bull Riders tour. They organized Capital Grille dinners featuring famed Boston-based baseball writer Peter Gammons, taking 10% of the $12,000 or so they brought in.

Working off commissions, they hit more singles than doubles or homers, but it all accrued as non-baseball revenue, making it exempt from MLB’s revenue-sharing structure that took 48 cents from each dollar the Red Sox brought in, a fact that Henry found especially satisfying.

Still, by 2007, they had started to wonder whether the expertise they delivered might be worth more. While exploring the commercial potential of sponsor-friendly NASCAR teams, they decided to invest rather than represent, taking a 50% equity stake in Roush Racing, which they landed on largely because of Henry’s affinity for founder Jack Roush, a brilliant engineer.

They also began to export their skills, cutting a deal to represent Premier League club Fulham in 2009. A year later, they decided to host an exhibition game — in soccer, known as a ”friendly” — at Fenway, signing up Scotland’s two fiercest rivals, Celtic and Rangers, to meet in July. Two months ahead of the match, Kennedy and Billy Hogan, executive vice president of sales, flew to Glasgow for a press conference to promote it. They met with leadership from Celtic, then headed to see the Rangers.

“And they started out by saying — ‘We’re not coming,’” Kennedy recalled. “Pardon me? We went into scramble mode.”

The Rangers had accepted a better offer to play in Australia instead. FSG quickly pivoted to Sporting CP of Lisbon.

Though Henry harbored no interest in soccer, he dutifully attended the match. When the first half closed without either team scoring, he left. So there was little reason to expect Henry to react favorably a few weeks later when Lucchino mentioned that Joe Januszewski, Red Sox senior vice president of corporate sales, had been bending his ear about FSG rescuing the Premier League club he supported, Liverpool FC, from impending bankruptcy.

Dining with Henry and Werner during a Red Sox series in Toronto, Lucchino dialed Januszewski and switched on the phone’s speaker, encouraging him to give his elevator pitch on why they should consider a bid for a fabled club that had fallen into shambles. When Januszewski stumbled, Henry encouraged him to send an email.

After reading a reasoned pitch that Henry now jokingly sums up as “Save My Club,” he consented to looking into it.

They met with the investment bankers representing the club in “R10,” the Fenway Park suite shared by Henry, Werner and other Red Sox equity partners. As they worked through their presentation, Kennedy and Werner sensed it was going badly. “I was sitting there and thinking you had no interest whatsoever,” Werner told Henry recently. “You weren’t even paying attention, I thought.”

“But in that meeting,” Henry said, “I did a 180.”

There were striking parallels between the Red Sox and Liverpool, franchises with long, rich histories that played on hallowed grounds in need of rehabilitation. Both clubs wear red. Each suffered through lengthy title droughts.

But Henry was more struck by a glaring difference.

“More than anything else, you own your marks,” Henry said. “You own everything globally. You can market globally. You have global fans. I’d gone to Selig a number of times with things we wanted to do and he said, ‘No, you can’t do that. If you do that, the Yankees will do it better.’ I said, ‘Let me try.’ No.

“In that meeting, when I heard all you can do — and it’s in bankruptcy? Wow.”

The longer Henry processed the upside, the more enthused he became. When one of the bankers suggested that a properly capitalized and managed Liverpool could compete with Manchester United, at the time the overwhelming Goliath of global soccer, Henry redirected him.

“We’re not doing this to compete with United,” Henry said. “We’re doing this to beat Man United.”

All that was missing was a first mate yelling, “Fish on!”

They headed to Liverpool for a due diligence trip that included a visit to Anfield Stadium, which owners Tom Hicks and George Gillett intended to replace with a futuristic 70,000-seat stadium of curvy, cold steel. Home to the club since its founding in 1892, Anfield had fallen into disrepair and was said to lack revenue-producing amenities. But, like Fenway, it had a soul. Memories made there spanned generations.

“We’re American sports owners. What do we know?” Kennedy said. “Then when you get into it, you find out that people are having their ashes scattered at Anfield.”

Henry arrived for FSG’s tour with a camera and a long lens, eager to catalog what he had quickly come to respect as a historic site. As their hosts walked them through a tour of one side of the stadium’s weathered — and in some spots, crumbling — stands, Henry kept venturing off on his own, snapping photos. He was gone for noticeably long stretches.

Eventually, he returned, wide-eyed.

“Have you guys seen the other side of the stadium?” Henry asked.

They told him they hadn’t.

“It’s great,” Henry said.

Though the Main Stand that they toured was nearing its end, the other half of the stadium had been expanded and renovated in the early ’90s. Further expansion would be helpful, but the stadium already had well-located suites.

“They hadn’t shown us any of that,” said Hogan, who would later move his family to Liverpool to serve as the club’s CEO. “It was in that moment that we said, ‘Look what we’ve done at Fenway. We kept what was great and unique about the Boston Red Sox.’ We didn’t know at the time whether we could. But being able to build Anfield into a modern football ground, most people wouldn’t have taken the time to even think about it.”

When they returned to Boston, negotiations raced forward, hastened by the closure-hungry creditors who’d seized control of the club from Hicks and Gillett.

Two months after beginning their due diligence, the FSG contingent waited in the offices of a London law firm for the Liverpool FC chairman who oversaw the sale, Martin Broughton, to deliver a verdict on their $476 million bid.

He entered the room dramatically.

“Congratulations gents, you have been awarded the rights to acquire Liverpool Football Club,” Broughton said, extending a hand toward Henry.

“No, no, no. Not so fast,” Werner said, stepping in. “John and I need to go for a walk.”

“He walked John out into the streets of London,” Kennedy recalled. “We’re all sitting there going, ‘Oh my God, what is going on?’”

They were buying a club on another continent, in a sport they knew next to nothing about, in a deal challenged in court by the ousted owners.

“It was just me asking John, ‘Are we ready to do this?’” Werner said. “I really wanted to make sure. Because by then we had seen the good, the bad and the ugly.”

They agreed they were.

Once home, Henry immersed himself in English soccer. He estimates that he watched about seven of the 10 or so matches televised in the U.S. each week; not just Liverpool, but every club. He devoured books and articles about the game’s history, culture, tactics and business. Occasionally, he contacted an author with a question.

“I felt like I had to,” Henry said, “because I knew nothing about it.”

A lifelong devotee of baseball simulations, starting with table-top games as a teen and graduating to elaborate computer sims that he still plays today, Henry took up their popular soccer counterpart, Football Manager.

By the time he started discussing how they might overhaul a club that had sunk to the Premier League’s bottom tier with Gordon, the Red Sox ownership partner charged with Liverpool’s oversight, Henry was deep into studying forward-thinking analytic models that most in the sport pooh-poohed.

“That’s John,” said Gordon, the Vinik Asset Management co-founder whose home in Boston’s Brookline suburb was a short walk from Henry’s at the time. “He watched every Premier League game he could find, and other games in continental Europe. He read at least three books. ‘How Soccer Explains the World’ was one; ‘Soccernomics’ was another. So complete immersion and absorption of all there is to learn about the club and the sport, to learn and understand what was important.”

“John is an autodidact, in just the most remarkable way that I’ve ever seen,” said Henry’s wife, Linda, CEO of the Henry-owned Boston Globe and an FSG partner. “He dropped out of college. But whatever he’s doing, he can just teach himself. I saw it when he got involved in soccer.”

“He watched every Premier League game he could find and other games in continental Europe. He read at least three books. … So complete immersion and absorption of all there is to learn about the club and the sport, to learn and understand what was important.”

—  Mike Gordon, Fenway Sports Group partner

For all the glory of the club’s turnaround, its ownership has not come without angst. Liverpool supporters took to the streets in protest in 2021 when it was revealed that the club was one of six that intended to leave the Premier League for an ill-fated breakaway Super League. When that fell apart, Liverpool released a 2½-minute apology video in which Henry spoke contritely into the camera, apologizing for the “disruption” that ensued when the plan was announced.

“I hope you’ll understand that even when we make mistakes, we’re trying to work in your club’s best interests,” Henry said in the video. “In this endeavor, I’ve let you down. I’m sorry, and I alone am responsible for the unnecessary negativity brought forward over the past couple of days. It’s something I won’t forget.”

FSG executives said Henry wrote the apology himself.

Capital infusions and Penguins

In November 2020, seven months into the COVID shutdown, Henry convened a Zoom call with FSG leadership to consider what could be a transformational opportunity for the company.

Earlier in the year, FSG had been approached by private equity investor Gerry Cardinale and former Oakland A’s general manager Billy Beane about taking FSG public through a $575 million special purpose acquisition company (SPAC) they had created. FSG would maintain its hold on 80% of the company, with the other 20% spun off in an IPO offered by Cardinale and Beane’s SPAC, RedBall Acquisition Corp.

They had agreed on a valuation and lined up institutional investors. All that was left was FSG’s green light to take the deal to market.

“We were at the point where it was kind of the moment of truth with the institutional investors that had committed,” Kennedy said. “And with our board and our investors.”

Shortly after the meeting began, Henry said he wanted to hear where each of FSG’s partners and leaders stood. One by one, they went around the Zoom room. The responses were unanimous. They all enthusiastically said they wanted to go.

Henry listened patiently before speaking.

“That’s great,” he said. “Now let me tell you why we’re not going to do this deal.”

Henry explained that he didn’t like the timing, not knowing how long it might take for U.S. sports to fully emerge from the shutdown. He was concerned about the market for SPACs generally. And he wasn’t sure they were prepared to weather the pressures and scrutiny that came along with quarterly earnings reports, even if their 80% position guaranteed them unchallenged control.

Still, Henry said he liked the benefits they had identified while considering the opportunity: Continuity, liquidity and the emphasis on growth.

“If we want to be more like a public company, we can do that without going public,” Henry said. “We need to do the things public companies do, but the right things, as opposed to the things they have to do in order to show growth.”

Cardinale quickly warmed to Henry’s logic. RedBird pivoted to a private placement that gave its investors 11% of FSG when it closed the following March. Flush with infused capital, Kennedy began shopping for FSG’s next acquisition.

Long attracted to the idea of adding an arena, they started with NHL franchises, calling ownership groups from the teams that might appeal to them to see if any would entertain selling or taking on an investor. He got nowhere until he cold-called Pittsburgh Penguins CEO David Morehouse.

“He said our timing was pretty good and we should call their bankers,” Kennedy said. “They’d actually begun a process.”

FSG acquired the Penguins for $900 million, closing on the last day of 2021. Last December, it agreed to terms to sell the team for a reported $1.7 billion, nearly double what it paid four years earlier.

Henry and Kennedy declined to discuss the sale because it is still pending. But when it closes, it will establish that FSG can buy an asset, improve it and exit at an appreciable profit, an important first for the company.

“Fenway is hard-wired for growth,” Kennedy said. “John is hard-wired for growth and value creation.”

The Penguins were the first of three acquisitions FSG made in its first three years after accepting venture capital.

In October 2022, the group invested in TMRW Sports, parent of the simulator-based TGL pro golf league, launching the Boston Common Golf, a franchise that features Rory McIlroy, a TGL co-founder.

Then, at the end of 2023, it announced a lead position in a ground-breaking, $3 billion investment aimed at remaking the business model of the PGA Tour, which would spin off its commercial interests into a new venture to be controlled by tour members, who would hold 86% of its equity.

The other 14% is held by Strategic Sports Group, a newly created investor group that includes FSG and a blue-chip panel of team owners from MLB, the NFL and NBA, who act as advisers on commercial matters such as event operations, scheduling, media deals and licensing.

“The structure of PGA Tour Enterprises is the most unique sports league there is, and it had never been done before,” Kennedy said. “It is cool and unique. And it was 100% John’s idea.”

The model Henry hatched allows individual players to accumulate equity based on tenure and performance, with grants vesting over time, a mechanism that should stem departures. The majority of the company is owned by a player-controlled 501(c)(6) nonprofit, which holds seven of PGA Tour Enterprises’ 13 board seats. SSG holds four.

Importantly, Henry proposed leaving operational expenses, including more than $500 million annually in purses, on the books of the original, nonprofit PGA Tour Inc. entity while moving all revenue — media rights, sponsorship and licensing, as well as event revenue from the tournaments the Tour controls — to the for-profit PGA Tour Enterprises, majority-owned and controlled by the players.

When the PGA Tour Inc. board proposed limiting the new commercial spinoff to revocable licenses, rather than rights that would hold up as assets, Henry suspected it wouldn’t wash with the players who liked the idea of equity. He responded by suggesting players fill the majority of seats on the new Enterprises board.

“There were elements of that structure where I remember getting an email from John and we were all like — this is never going to happen,” said Vinay Nayak, FSG’s senior vice president of strategy and portfolio operations, who worked closely with Henry on the framework. “Like, how could this happen? And then, sure enough, six months later we were closing on this deal. Aspects of that structure, but also the entirety of that vision, were John’s ideas.”

Henry does not play golf and until recently did not follow golf. He took on the tour’s dilemma largely as a problem-solving exercise, eager to aid PGA Tour Commissioner Jay Monahan, a former FSG executive who was Kennedy’s college roommate. The deeper he got into golf’s byzantine structure, the more determined he became to change it.

“This is a guy who once asked me, ‘What is the difference between a golf club and a golf course?’” Werner observed, deadpan. “But his perception and ideas of how to strengthen the content of the PGA [Tour] has been adopted.”

Milwaukee Brewers owner Mark Attanasio was walking into an MLB owners’ committee meeting when he came upon Henry explaining his plan for the tour to Atlanta Braves Chairman Terry McGuirk.

“That sounds like an interesting investment,” Attanasio said offhandedly.

Two days later, Henry texted Attanasio asking why he liked the idea. After a few more texts, Henry invited him to invest.

“It was complex from a structural standpoint, from a constituency standpoint and from the fact that you needed a turnaround in the operations,” Attanasio said. “I always find that things like that create opportunity, versus buying Nvidia today at $200 a share.”

Attanasio joined New York Mets owner Steve Cohen, Atlanta Falcons owner Arthur Blank, outgoing Boston Celtics owner Wyc Grousbeck and former Milwaukee Bucks owner Marc Lasry in what is now known as Strategic Sports Group.

“He came at it with a whiteboard and said, ‘How can I find a system that aligns the players, the tour, and us and [our] investors — and at the end of the day, makes the players the owners of their sport?” said Ed Weiss, FSG’s general counsel. “He worked on the plan with a lot of the people on the team. But he unlocked it. He was the one to say, ‘Why don’t we do it this way?’ And everyone was like — ‘Hmmmm.’ There was an immense amount of work to be able to proof it out to make sure it was going to work. And John did a lot of that.

“John does a lot of that.”

Looking ahead

At a table in a hotel bar that opened early to host a Saturday morning Liverpool viewing party during the March partner meetings, Weiss thought back to the job interview that brought him to the group in September 2009.

He met with Henry, Werner and Lucchino. When the latter two had to leave after an hour, Henry asked him to stick around.

“I think you’re going to be our guy,” Henry said.

A Penn law graduate who was magna cum laude at Harvard, Weiss had spent 10 years at Time Warner, for which he was deputy general counsel, responsible for all litigation and intellectual property issues.

“John asked a lot of really great questions about the future of the sports media business,” said Weiss, whose first meaty assignment was a summer spent on the Liverpool acquisition. “A lot of people were comfortable in those days with the notion that you’re part of the cable bundle and the money keeps flowing in. It was probably the single greatest monetization system in the history of the world. But he already saw that there were changes afoot. Streaming was starting to become a thing that was going to disaggregate audiences.

“I was in the space. He, at that time, was only a little in the space. But he was already thinking about what was going to happen when this starts to go in a different direction.”

On each deal Weiss has worked on, he has been struck by the questions Henry asked, almost always out of honest curiosity, not as a quiz.

“He pulls back and wants to understand how it all works,” Weiss said. “That’s in soccer, baseball, NASCAR and the PGA Tour, where he unlocked the way to get everybody aligned.

“I always feel like he’s dealing in quantum mechanics when the rest of us are dealing in linear algebra.”

Henry insisted that, when it comes to the thought process that has yielded a $14 billion sports conglomerate, his formula is far simpler.

“In that portfolio, it has never, ever been about investment,” Henry said. “It’s what you want to do with your time.”