Private equity in sports: Olympics as a new investment field?
One of the oldest asset classes in private markets, the market for unlisted companies, is private equity. Its origins date back to the 19th century, when wealthy private individuals took part in the emerging industrial sector. Infrastructure or consumer goods are still popular destinations for private equity investors today. But in recent years, private equity firms have also massively expanded their interest in the sports market. In particular, the purchase of shares in soccer clubs or the NFL has shown that investors expect high returns in this area. Now even Olympia is increasingly becoming the focus of private equity companies.
Sport as an asset class
Professional sport is traditionally financed by public money, sponsors and TV rights. But rising infrastructure costs, professionalization of marketing, and increased commercialization have created a financial gap that private equity firms could fill by bringing in capital, management expertise, and new business models.
Until a few years ago, the sports sector was actually too small for well-known private equity houses such as Advent, CVC, KKR or Permira. However, large PE companies are now also increasingly interested in sports associations and sports leagues, as these have high financing requirements and offer potential returns. For example, is CVC active in women's tennis, volleyball, soccer and rugby And has even Interest in the Bundesliga states.
In Germany was KKR 2014 the first financial investor in the Bundesliga and got involved with Hertha BSC. The total volume of the deal at the time was 61.2 million euros — including around 18 million for an equity share of 9.7 percent in the corporation through which the club participates in the Bundesliga game operation. The private equity firm transferred around 36 million euros as a type of loan and in return received a share of future income. The rest flowed as a signing fee. However, after just under five years, the New York-based private equity firm withdrew from Hertha BSC.
At the end of 2024, a US deal caused a stir: The Ares Management Corp. had acquired a ten percent stake in the Miami Dolphins, which was valued at eight billion dollars. Following this historic investment, Ares plans to make further investments in NFL teams.
CVC, one of the world's largest investment firms, has a particularly broad portfolio of sports investments. The company has invested at least six billion dollars in at least 13 sports companies. The biggest commitments include:
- $1.15 billion to Authentic Brands Group, owner of Sports Illustrated
- Over two billion dollars in the Spanish LaLiga
- 1.6 billion dollars for a 13 percent stake in the Ligue de Football Professionel, the governing body of French soccer
In addition to these soccer investments, CVC holds shares in Premiership Rugby (PRO14), Six Nations Rugby (500 million dollars investment) and 28 percent of the United Rugby Championship. In addition, CVC owns 20 percent of the Women's Tennis Association (WTA, 150 million dollar investment) as well as shares in Volleyball World, the Gujarat Titans (an Indian cricket team) and the German sports betting company Tipico.
Investment object: Olympics
Despite the numerous commitments of private equity firms, the “Olympus” of sports only became their focus at the beginning of 2025. Because the Olympic Games stand for sporting excellence, but also for gigantic costs. Many cities, such as Paris recently, and national committees are struggling with the financial burdens. Private equity funds see an opportunity here: They could participate in financing the Olympic Games, the development of athletes, or marketing rights. A partnership with the International Olympic Committee (IOC) or national associations would also create new revenue models.
At the end of January 2025, a possible initiative by Juan Antonio Samaranch, a candidate for IOC President, became public. In the event of his election victory Is he planning to work with private equity firms such as CVC, Carlyle or Permira to make the Olympic Games more financially stable. An investment fund for sports-related companies and the monetization of Olympic Broadcasting Services could play a central role in this. However, Samaranch also stressed that the fund would not directly compete with private equity firms. Instead, the fund — which it believes could raise a billion dollars in a first round — should take care of everything else: equipment manufacturers, training systems, sports financing and development.
Private equity continues to grow
In the past, private equity — regardless of the financing purpose — was mainly open to institutional investors or very wealthy, wealthy private individuals. Mainly due to high minimum investments, strict approval requirements and comparatively high illiquidity. But private equity has evolved and has sometimes become more accessible thanks to new regulations.
For example, the European Long-Term Investment Fund ELTIF a Europe-wide system that gives a wider range of investors, including retail investors, access to private equity. The advantages of ELTIF include a low minimum subscription, simplified subscription processes and shorter investment periods and terms.
Thanks to these developments, private equity can now be found in the portfolios of institutions, intermediaries and private individuals worldwide and with 36 new registrations in Europe by the end of the third quarter of 2024 More ELTIFs were launched than ever before. There are also signs of growth for 2025, as investment requirements in many sectors are high and, in view of low interest rates and geopolitical tensions, private assets are crucial for portfolio resilience. Especially since, in contrast to exchange-traded products, private equity is not exposed to daily price fluctuations and can therefore bring stability to the portfolio.
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