Apollo Global Management Inc. is providing $2.6 billion of financing to the owners of the New York Yankees, the private capital giant’s largest investment to date in US sports.
The deal between the Major League Baseball franchise and Apollo’s sports investment arm consists of debt and equity, according to a statement Tuesday that confirmed previous Bloomberg News reporting. Proceeds will be used to support the growth of the franchise and refinance existing debt.
The sports financing market is becoming increasingly competitive, as firms including Arctos Partners, CVC Capital Partners and Ares Management Corp. seek greater exposure to leagues and franchises spanning the world’s most popular sports.
Based in the Bronx, the Yankees are the financial powerhouse of American baseball. Sportico values the franchise at more than $9 billion, placing it among the world’s most valuable teams. It’s also one of the most recognizable global brands, thanks to its history of stars like Joe DiMaggio, Mickey Mantle, Babe Ruth and Derek Jeter, and the NY insignia emblazoned on its merchandise. The club has won 27 World Series titles in its history, but none since 2009, despite having deep pockets and a willingness to spend on premier players.
The Yankees are owned by Yankee Global Enterprises, a company controlled by businessman Hal Steinbrenner and members of his family. The group has also invested in Italian football club AC Milan and Major League Soccer’s New York City FC. The Steinbrenner family are retaining full control of the Yankees.
“We are continually seeking ways to strengthen our positioning, and this partnership allows us to explore pursuing strategic opportunities,” Hal Steinbrenner said in Tuesday’s statement.
Apollo has been expanding its focus on providing long-term financing to sports leagues and clubs, while also taking ownership stakes. Its Apollo Sports Capital business, led by Al Tylis, launched a $5 billion initiative last year and has since become the majority shareholder of Spanish soccer club Atlético de Madrid.
Tylis will join Yankee Global Enterprises’ board, which will expand by one seat.
Goldman Sachs Group Inc. advised Yankee Global Enterprises.
(Updates with details of statement throughout, adds additional background on franchise.)