Private equity investment values Man City owner CFG at mammoth $4.8bn

By David Owen

November 28 – City Football Group (CFG) may step up its hunt for new football investments around the world, following agreement of a $500 million equity investment in the business by Silver Lake, a US private equity firm.

The injection is said to value CFG post-investment at a towering $4.8 billion.

Abu Dhabi United Group, the investment vehicle owned by Sheikh Mansour bin Zayed Al Nahyan, will remain comfortably the majority shareholder at around 77%. A consortium of Chinese institutional investors led by China Media Capital Holdings (CMC) will retain around 12%. Egon Durban (pictured left), a managing partner and managing director of Silver Lake, will be added as a ninth CFG board member.

Silver Lake, which claims to be the “global leader” in technology investing, is already an investor in sports-related assets such as the Madison Square Garden Company and the mixed martial arts organisation UFC.

News of the investment comes the day after Manchester City, by far the best-known club in CFG’s growing portfolio, qualified for the Champions League knockout stages with a 1-1 draw against Shakhtar Donetsk.

The Manchester club recently lost an appeal to the Court of Arbitration for Sport (CAS) to halt UEFA’s investigation into alleged financial fair play irregularities. Earlier this month, it reported a pre-tax profit for the year to end-June 2019 of just over £10 million on revenue of £535.2 million. 2018-19 was a phenomenal year on the pitch for the team, which won all three major domestic trophies.

CFG itself posted a £44.8 million loss from continuing operations in its most recent results for the year to end-June 2018. This was obtained on revenue of just under £585 million.

Other clubs in CFG’s portfolio include New York City, Melbourne City, Yokohama F. Marinos, Club Atlético Torque in Uruguay, Spain’s Girona and China’s Sichuan Jiuniu.

Khaldoon Al Mubarak (pictured right), CFG chairman, said he was “delighted by both the validation that [Silver Lake’s] investment in CFG represents, and the opportunities for further growth that their partnership brings.

“We and Silver Lake,” he continued, “share the strong belief in the opportunities being presented by the convergence of entertainment, sports and technology and the resulting ability for CFG to generate long-term growth and new revenue streams globally.”

Durban said Silver Lake was “excited” to invest in CFG which had “successfully built an impressive global platform of marquee football clubs across five continents”.

The deal was said to be subject to “customary closing conditions including regulatory approval in some territories”.

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