Investors Corner: M&A Activity in Sports—Private Equity Surges

The Rise of Private Equity in Sports M&A: A Power Shift in Motion

What was once a landscape dominated by strategic buyers—teams, leagues, media companies—has increasingly become a playground for private equity. The data tells the story: global sports acquisitions rose from 152 in 2018 to 410 in 2024, with private equity’s share surging from 50 to 190 deals. That’s a 280% increase, compared to a still-impressive but more modest 116% rise among strategic buyers.

The implications for the industry are profound. Private equity now accounts for 46% of all sports-related acquisitions, nearly matching strategic activity. This isn't just capital flowing into an emerging asset class—it’s a structural realignment of power within the sports economy.

Why PE is Gaining Ground

Sports assets—whether franchises, rights holders, digital platforms, or event IP—offer exactly what PE investors crave: recurring revenue, global growth tailwinds, brand equity, and increasing monetization potential through media, sponsorships, and technology. Add to that new regulatory green lights (like the NFL loosening ownership rules) and it’s no surprise that sports are evolving into a favored alternative asset class.

PE firms aren’t just buying in—they’re reshaping the model. Arctos, Ares, Sixth Street, and others are building diversified sports portfolios, aiming to generate alpha through operational improvements, syndication, and cross-platform integration. They’re also unafraid to challenge traditional structures—centralizing media rights, spinning off digital assets, and pushing for greater financial transparency in historically opaque markets.

Strategics Are Still Active—but Vulnerable

Strategic acquirers—media companies, team owners, and brands—still play a major role, with 220 deals in 2024. But they’re increasingly being outpaced. Unlike PE firms, strategics often move slower due to governance hurdles, risk-aversion, and capital constraints.

This creates two challenges: (1) missing out on fast-moving opportunities, and (2) facing inflated multiples as auctions heat up. For some, this has forced a strategic rethink: partner with PE, compete directly, or pivot into more defensive dealmaking (e.g., acquiring minority stakes, JV structures).

What to Watch in 2025 and Beyond

• Valuation floors are rising as PE dry powder continues to chase yield.
  

• Club ownership rules are loosening globally—opening up new avenues for control and consolidation.
  

• Tech assets (streaming, fan engagement, data analytics) are becoming primary targets, as sports moves beyond the game itself.
  

• Exit activity is likely to grow, with funds targeting IPOs, strategic resales, or asset syndication as key return levers.
  

Bottom Line

The sports industry is no longer just a strategic playground—it’s now a battleground for institutional capital. For investors, leagues, and dealmakers, tracking the interplay between PE and strategic players will be crucial to understanding valuation trends, deal structures, and control dynamics in the next cycle.