Sold separately: the rise of carve-outs and carve-ins in sports investment
Sport has emerged as a genuine asset class. A combination of scarcity, recurring media and commercial revenues, appointment viewing, global fan bases and powerful intellectual property has attracted private capital investors seeking long-duration, resilient assets with strong growth characteristics.
A broader range of deal structures and opportunities are emerging. One notable market theme is the increase in carve-out and carve-in transactions.
- A carve-out separates a business unit or vertical previously integrated into a larger sports entity and restructures or sells it as a standalone asset.
- A carve-in assembles a new standalone sports business or platform, or supplements an existing one, by acquiring and integrating separated components across jurisdictions or sports (examples below).
For investors, carved-out assets often present the opportunity to acquire businesses at a discount in high-growth markets, particularly where those assets have been subject to historic underinvestment. The challenge in carve-outs and carve-ins is the operational complexity of standing up the target business unit or asset for success in the short, medium and long term. Early and thoughtful diligence, deal structuring and comprehensive legal documentation are crucial for successful execution.
This article examines why carve-outs and carve-ins have become an increasingly prominent feature of sports investment, the types of assets most commonly involved (namely women's sports teams, commercial rights businesses, and real estate and infrastructure), and the key commercial and legal challenges that investors and sports entities must address to execute these transactions successfully.
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- Tags: Commercial | Corporate | Football | Real Estate | Spain | The FA | United Kingdom (UK) | Women’s Football | Women’s Sports
Written by
Jamie Andrew
Jamie is a Senior Associate at Clifford Chance and advises clients across a range of sectors including technology, sport, private equity and financial services.
Eric Schaffer
Eric Schaffer is a partner in the Private Equity M&A group at Clifford Chance in New York. He advises private equity sponsors, asset managers, sovereign wealth funds, family offices and strategics on complex domestic and cross-border transactions, including mergers, acquisitions, dispositions, joint ventures, co-investments, minority and growth capital investments, and corporate reorganizations. His practice spans across a range of sectors, with a particular focus in the Entertainment & Sports sector.
Neil Barlow
Kamryn Rana
Kamryn is a lawyer in Clifford Chance's Tech Group and Tech M&A team. Kamryn advises clients on cross border and domestic M&A, VC and growth equity investments, fundraisings and strategic commercial transactions.
