Stan Kroenke’s agreement to buy the Angels for an MLB-record $4B continues a summer of landmark sports team transactions, following the sales of the Padres for $3.9B, Seahawks for $9.6B and, if all goes to plan, Lakers for $12.5B. Each of those deals was or will be completed at a league-record control valuation, and Rogers’ acquisition of Maple Leaf Sports & Entertainment almost certainly put an NHL-record value on the Maple Leafs.
Industry insiders have explained the explosive run-up in valuations and why investors remain bullish on continued growth. Live sports are insulated from AI disruption, valuations are bolstered by the arrival of large-scale private equity and a newly minted class of tech-investing billionaires has created more potential buyers.
But the best explanation is a simple one: History has demonstrated that teams are not only a resilient store of value, but they have consistently outpaced public markets. In fact, nearly every control transaction in the Big Four leagues since 2020 has generated significantly higher compound annual growth rates than the S&P 500.
Note: The above table omits expansion teams, ongoing transactions for the Angels, Lakers and Timberwolves, and Rogers’ control acquisition of multi-team holding company Maple Leaf Sports & Entertainment.
Rising values have also failed to slow the pace of minority transactions. That goes for both private equity-backed deals, like Arctos’ agreement to acquire 10% of the Falcons at a $10.6B valuation and Apollo’s $2.6B financing deal for the Yankees, as well as investments from high-net-worth individuals, who were responsible for acquiring minority stakes in the New York Giants, New England Patriots and San Francisco 49ers at or near record valuations.
As Latham & Watkins partner Matthew Eisler previously told SBJ, “it’s easier than ever … to raise massive amounts of money because there’s so many billionaires that don’t feel like they’re a guinea pig in an evolving market.” That investor confidence in the sports asset class is a long time coming: The Ross-Arctos Sports Franchise Index has found that team values have, on average, compounded at 13% annually over the last 65 years.
The pace of record-breaking team transactions is not expected to slow anytime soon. The NHL is nearing the sale of an expansion team in Houston, investors are assembling bids for potential NBA expansion teams in Las Vegas and Seattle, and insiders say sky-high valuations should only encourage further sale activity from longtime owners.