Private Equity Burrows Deeper Into College Sports
Daniel Levy has been the most influential person at Tottenham Hotspur for almost 25 years. The chairman transformed the financial fortunes of the soccer club through increased commercial success, built a $1 billion stadium, and firmly established the North London team as one of the English Premier League’s “big six.” It just doesn’t have the silverware to show for it.
For the past 18 months, Spurs have been the focus of interest from new investors. New York–based MSP Sports Capital was linked with a purchase in late 2023 before stepping back, and Levy held talks with Qatar Sports Investments chairman Nasser Al-Khelaifi about a potential minority stake in 2024.
Recent months have also seen former Newcastle United co-owners Amanda Staveley and her husband, Mehrdad Ghodoussi, linked with a takeover move backed by wealthy investors from Qatar.
But Levy doesn’t appear ready to relinquish control of his boyhood club.
On Wednesday, Bloomberg reported Levy has “stymied” takeover talks. His high valuation of Spurs and his wish to remain in charge of strategy have been major roadblocks.
As the most visible senior figure at the club, Levy is often a lightning rod for criticism toward majority owners ENIC Sports Inc., the firm helmed by London-born billionaire Joe Lewis. The Lewis family holds 70% of the ENIC Sports Inc. investment, with the rest of the 87% held by Levy, the highest-paid club director in the EPL.
While ENIC owns the controlling stake, Levy wields tremendous power from leading the club’s financial turnaround. (Spurs have eclipsed the $3 billion valuation mark by Forbes’s most recent estimate.) The club is now one of the most valuable and high-profile assets in the Tavistock Group, the holding company of which Levy is a board member and where his son Josh serves as co-CEO. (Lewis’s children, Vivienne and Charles, hold positions as managing directors.)
“Daniel Levy earns well at Spurs. As per the most recent accounts, he was taking home more than £6 million a year as well as the shareholding he possesses in the club,” says U.K. football finance expert Kieran Maguire, author of The Price of Football and host of the eponymous podcast.
“But he wants them to be successful on the pitch, and soccer delivers something that is unique, and that is fame and adulation,” says Maguire. “He was heavily involved in futureproofing the club and building the new stadium, which was done when interest rates were phenomenally low. It really was a masterstroke.” (Around 90% of Spurs’ near $860 million debt is at a fixed rate, with a significant amount of that at interest rates of just under 3%.)
Revenue at Spurs has risen by 170% over the last decade, sitting at a little over $670 million as per the recently published Deloitte Football Money League, good for ninth among world soccer teams.
In the four financial years between 2015 and 2019, Spurs made a pretax profit just short of $400 million, the highest in the EPL. While they have failed to post a profit in the four years since, they have seen revenues rise considerably thanks to the new stadium.
Levy secured a lucrative, multiyear deal with the NFL to host annual regular-season games, part of his plan all along with bespoke locker rooms and a retractable surface that changes from soccer pitch to football field. Music is part of the equation, too: Beyoncé will play a six-night run this summer after the success of her five-night 2023 visit to the stadium. Kendrick Lamar and SZA are also slated to perform in July.
But aside from a 2019 Champions League final appearance and a 2017 second-place league finish, the biggest prizes have proved out of reach for Spurs, while the unrest among supporters—and ire toward Levy—has grown, as evidenced by recent protests before the club’s home match with Manchester United on Feb. 16.
The club has the lowest wages-to-revenue ratio percentage of all 20 EPL teams at 42%, something viewed by fans as focusing more on the bottom line than competitive success, while the squad cost less than the other members of the “big six,” namely Arsenal, Chelsea, Liverpool, Manchester City, and Manchester United.
But that focus on business performance has afforded them greater room to invest in the coming years, something that will aid Levy’s efforts at achieving the silverware he craves.
Jordan Gardner, a U.S. investor in European soccer and adviser to those seeking to invest in the space, believes that with the desire to stick around to try to secure competitive success, Levy has little motivation to step aside.
“People underestimate emotional attachment,” Gardner tells Front Office Sports. “If I’m Daniel Levy and I played such a key role in building this business and making it viable, I’m looking for someone to support me rather than show me the door. He’s a strong personality and he’s unlikely to want to do a deal with people with whom he is not aligned.”
