GAM Joins Sports Investing Push with Private Equity Partnership
5 JUN, 2024
By Jose Luis Palmer from RankiaPro Europe
GAM, a Swiss asset manager, has ventured into sports investing by partnering with US-based Avenue Capital. This collaboration marks a significant step in GAM's long-term alternatives expansion strategy.
Strategic Partnership and Fund Expansion
In March, GAM signed an agreement with Avenue Capital to collaborate on the Avenue Capital Sports Opportunities Investment fund. GAM will leverage its distribution network to expand the fund's reach, raise assets, and attract global investors, likely through a feeder fund.
This partnership aligns with GAM's strategic focus on alternatives, identified as a key growth area under its new ownership structure.
Booming Sports Investing Sector
Sports investing has surged in popularity, driven by perceived inefficiencies and potential revenue growth in sports business models. European asset managers like Mandarine Gestion and DNCA have launched specific sports investment vehicles, while private market firms such as CVC Capital have invested heavily in sports leagues, including Spain's La Liga, Premiership Rugby, and the Six Nations tournament.
The Appeal of Sports as an Asset Class
GAM and Avenue Capital highlight the strong consumer focus on live sports, noting that sports accounted for 95 of the 100 most-watched TV programs in the US in 2022. They emphasize that live sports offer unique growth opportunities and low correlation to traditional asset classes, driven by fan engagement and increased media spending.
Experienced Leadership and Unique Insights
The Avenue Sports Opportunities fund is managed by Avenue co-founder Marc Lasry, who previously co-owned the NBA's Milwaukee Bucks. The fund benefits from an "Athlete Team" comprising sports stars like Candace Parker, Harry Kane, and Stephen Curry, who provide proprietary insights and sourcing opportunities within the sports industry.
Diverse Portfolio and Global Reach
Current investments in the Avenue Sports Opportunities fund include ownership stakes in the PGA Tour, Tiger Woods' TGL Golf venture, Team USA in professional sailing, and the Professional Bull Riding Team Series.
Avenue Capital Group, managing around $12 billion in assets, focuses on specialty lending, undervalued debt, and equity opportunities across the US, Europe, and Asia. This partnership with GAM is expected to further enhance its footprint in the dynamic sports investment landscape.
