U.S. Investors Eye Lower-Tier European Soccer Clubs

In recent years, the European soccer scene has captivated U.S. investors, with many focusing their interests on the continent's top-tier clubs.

by Faruk Imamovic
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U.S. Investors Eye Lower-Tier European Soccer Clubs
© Getty Images Sport/Steve Bardens

In recent years, the European soccer scene has captivated U.S. investors, with many focusing their interests on the continent's top-tier clubs. However, as the investment landscape evolves, there's a new trend on the rise: U.S.

investors are increasingly setting their sights on lower-tier European soccer clubs, seeking both value and opportunity.

The Multi-Club Model: A Rising Trend

While marquee names in European soccer have always been appealing, a segment of savvy investors from the U.S.

is adopting a fresh approach – the multi-club model. By investing in clubs with lower valuations, these investors aim to take advantage of the global sports market's growth without the skyrocketing deal valuations associated with top-tier clubs.

This trend reflects the escalating competition among deep-pocketed investors, ranging from leading U.S. private equity and venture capital firms to global competitors like sovereign wealth funds. Charles Baker, co-chair of the law firm Sidley’s entertainment, sports, and media group, observes, “In terms of private equity and high net worth individuals, soccer is more of a global sport than almost any U.S.

sport”. Baker's comment underscores soccer's broad appeal and its potential for tapping into massive global fan bases.

The Financial Play: Why Soccer Clubs?

The allure of soccer as an investment avenue isn't just about the sport's popularity.

It also offers significant financial upsides. With the sport's growing fan base, especially in the U.S., clubs can access multiple streams of revenue, from broadcast media rights deals to merchandising. Top clubs like Manchester United, Chelsea FC, and Newcastle have witnessed an upward trajectory in their revenue.

As noted by PitchBook, the valuations of many such clubs have not only doubled but they also tend to sell at a premium. A staggering growth was recorded in 2022 when the valuations of clubs across the top five European leagues surged from a mere $70 million in 2018 to a whopping $5.2 billion.

U.S. investors, especially those from the private equity and venture capital sectors, seem to be spearheading this trend, with more than a third of the clubs in Europe's "Big Five" leagues now having U.S. backers. Noteworthy transactions include U.S.

investor Todd Boehly and Clearlake Capital's acquisition of Chelsea FC for over $5 billion and RedBird Capital Partners' takeover of AC Milan for nearly $1.3 billion. According to an analyst report from PitchBook, "These recent transactions have set a precedent in terms of club valuation but also prompted many owners to consider selling to [private equity]."

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