The Patriots are selling a total 8% stake in the team to two separate buyers at a more than $9 billion valuation, with private-equity firm Sixth Street buying 3% and Greek American billionaire Dean Metropoulos picking up 5%.
The two minority stake sales value the Patriots at more than $9 billion, two sources familiar with the matter confirmed to Front Office Sports. The deals were first reported by Sports Business Journal. The Patriots later announced the transactions, although they did not include financial details.
One source says Robert Kraft will use proceeds from the stake sales to reinvest in the team.
“The Kraft family remains fully committed to long-term ownership and operational control of the Patriots,” the Patriots said in a statement.
The sales remain subject to league approval, which the Patriots said is expected in October.
The deal with Sixth Street represents the fourth private-equity investment in an NFL team since owners voted 31–1 last summer to approve a policy that allows firms to buy minority stakes (the Bengals were the only team to vote against the policy). Sixth Street’s is the smallest PE stake of the four deals that have happened—Arctos Partners previously purchased 10% stakes in both the Bills and Chargers, while Ares Management acquired a 10% stake in the Dolphins.
Under the NFL policy, 10% is the cap for PE ownership stakes, and if more than one firm wants to buy a stake in the same franchise, their collective stake cannot exceed 10%. Before this season kicked off, a representative for the NFL told FOS that the private-equity policy has been a “tremendous success.”
A representative for Sixth Street declined to comment, and a representative for Metropoulos did not immediately respond to a request for comment.
Metropoulos is the founder of Metropoulos & Company, which has previously invested in the likes of Hostess Brands and Pabst Brewing Company.
Sixth Street is among the most prominent PE firms with regard to sports investment. In addition to the Patriots, it owns stakes in the NBA’s Celtics and Spurs, MLB’s Giants, and soccer teams Real Madrid and Barcelona. The firm is also the majority owner of the NWSL’s Bay FC.
The deal leaves the Bruins as the only one of the Boston teams in the four major U.S. men’s pro sports leagues (NFL, NBA, MLB, and NHL) that do not have private-equity investors, as first pointed out by Axios’s Dan Primack: Sixth Street is invested in both the Patriots and Celtics, while the Red Sox count RedBird Capital Partners as a minority investor.
The NFL has seen a dizzying amount of minority stake sales lately, and valuations are soaring—under league rules, each team can have up to 24 limited partners.
Last week, the 49ers reportedly sold a 3.2% stake to Pete Briger Jr., managing partner at Fortress Investment Group, and in May the team sold a total 6% stake to a group of three families. Both of those deals valued the team at more than $8.5 billion. In September, the Giants sold a 10% stake to Julia Koch and members of her billionaire family at a reported valuation of more than $10 billion.
The Bears were valued at $8.8 billion in an equity share deal that was reportedly reached in August. Meanwhile, in May the NFL approved the sale of a 0.1% stake in the Browns to Pro Football Hall of Famer Charles Woodson, and the sale of a 1.1% stake in the Dolphins to an undisclosed group of businessmen. Before that, in December, the NFL approved the sale of an 8% stake in the Eagles to two investment groups. Last October, Tom Brady bought a roughly 5% stake in the Raiders.
Editors’ note: RedBird IMI, in which RedBird Capital Partners is a joint venture partner, is the primary investor in Front Office Sports.
