Which English Premier League club is next for PE investment?
In an Interview with Third Bridge Forum, a former executive at Liverpool Football Club said that the EPL is “substantially much more appealing” for private capital firms than other leagues across Europe. This is due to the “prize” of significant broadcast revenue and the “global exposure or appeal” of the EPL brand, according to the specialist.
The specialist said that less than 50% of EPL clubs are currently profitable. However, they told us that the real value for owners lies in growing overall club asset value. They recommended that besides Manchester United, which has attracted interest from Ineos owner Sir Jim Ratcliffe, West Ham United and to a lesser extent Crystal Palace, should be attractive targets for PE investors given both clubs’ London location. These “tier 2 clubs” are growing commercially, the specialist told us, and have developed “commercial structures that can be maximised”.
The specialist believes that there are opportunities for private project financing to build out EPL stadiums. They said some tier 1 clubs – Arsenal, Chelsea, Liverpool, Manchester City, Manchester United and Tottenham Hotspur – are still oversubscribed and those fans cannot yet be commercialised without increased stadium capacity. The specialist said private financing could be used to update smaller, older and lower club-tier stadiums to offer premium experiences such as executive boxes and a potential virtual offering for international fans that cannot attend games.
Overall, the specialist said PE investors in EPL clubs should consider the club’s tier, commercial opportunities, infrastructure investment, academy and the operational side of football before deciding to invest. Investment does not always guarantee success, according to the specialist, and they said that finding a club with the “right opportunities” – both on and off the pitch – is “ultimately” how PE investors can see a return on their investment.
Click here to access all the human insights in the Third Bridge Forum Interview, “English Football Clubs – 2022 Operating Landscape Update & Take-private Considerations”.
The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.
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