Apollo to launch $5bn sports investment vehicle
Private capital firm plans to buy stakes and lend to clubs and leagues as it steps up push into sector
Apollo Global Management is planning to launch a $5bn sports investment vehicle, as it looks to deepen its exposure to a sector that is attracting a growing amount of funding from the world’s largest private capital groups.
The New York-based firm, with more than $800bn of assets under management, has been accelerating its push into sports in recent years, with investments ranging from Premier League football clubs to horseracing ventures.
But Apollo’s new vehicle will mark the first time the investment giant has allocated permanent capital to the sector. The firm will make new hires to lead the strategy, which will focus on lending to sports leagues and teams, as well as buying stakes in clubs, according to people familiar with the matter. Apollo declined to comment on its plans.
Apollo is one of several major private capital groups pushing deeper into the fast-growing area of sports finance, which is poorly served by mainstream lenders. Private capital firms can deploy capital quickly, often in return for high yields.
Apollo’s most noteworthy deals to date include lending £80mn in expensive debt to Nottingham Forest Football Club, secured against assets including the club’s stadium, its first known foray into Premier League football.
The Financial Times reported last week that it also lent £40mn to football super agent Kia Joorabchian’s Sports Invest Holdings, charging an interest rate of 10.25 per cent.
The unorthodox debt is secured against a number of the agent’s companies including AMO Racing, AMO Stables and Sports Invest UK, a branch of Joorabchian’s management group that works with footballers “from youth to international level”.
As well as doing his own business with the private capital group, Joorabchian is actively looking for sports deals to pass to Apollo as it attempts to expand its presence in European football.
Apollo has also been exploring bigger deals: the US firm has been in talks this summer with Atlético Madrid about taking a stake in Spain’s third-largest football club.
In recent years the firm considered financing bidders for Manchester United and previously agreed a $1.25bn investment in the Mexican football league that later unravelled.
CVC, a long-term investor in sport, has invested in La Liga, Spain’s top football league, as well as rugby’s Six Nations tournament and Indian Premier League cricket franchise the Gujarat Titans.
Meanwhile, US firm Ares Management, a close peer of Apollo’s, has lent hundreds of millions of pounds to John Textor’s Eagle Football group as well as Chelsea FC.