William Blair & Co. Head of Investment Banking Matthew Zimmer said that acquisitions in the sports industry are “set to increase as investors leverage a slew of different approaches to the fast-growing sector.” Zimmer noted that that is in part as minority stakeholders in many professional teams “look to exit, college athletic associations leverage … name, image and likeness agreements and parents spend more on their kids in youth sports.” William Blair this month acquired Inner Circle Sports, an advisory firm known for deals involving Premier League club Liverpool FC and the 76ers, as the investment bank “makes a play in one of Wall Street’s hottest sectors.” Rob Tillis, who founded Inner Circle in 2002, pointed to “more drivers sustaining team valuations, and making acquisitions more attractive, including real estate developments around stadiums and arenas, media rights growth, as well as international expansion of leagues” like the NBA into Europe. In addition, women’s sports “represent emerging opportunities, with investors pouring into soccer, volleyball and women’s basketball.” Zimmer said that traditional private equity firms are “looking into software and sports services, among other ways to deploy capital in the sector.” Among the challenges investors face is “political scrutiny.” Private capital in youth sports, for example, faces legislation in the U.S. from lawmakers who argue that it “makes sports more expensive and less accessible” (BLOOMBERG NEWS, 7/6).
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