Silver Lake Raises Stake in Parent Company of Manchester City

By Geoffrey Smith 

Investing.com -- U.S. private equity group Silver Lake has raised its stake in the parent company of English soccer champions Manchester City, the latest in a series of big-ticket bets on global sport.

According to the Financial Times, the group bought a 4.1% stake in City Football Group from China Media Capital, taking its stake to 14.1% and making it the second-largest shareholder in the group behind the United Arab Emirates' Sheikh Mansour bin Zayed Al Nahyan.

Shanghai-based CMC's stake has accordingly fallen to 8.2% and appears to fall into a pattern of gradual withdrawal by Chinese investors from trophy assets in the entertainment sector as a domestic economic slowdown puts pressure on the finances of some.

CFG has spread its tentacles far and wide through global soccer in the last two years, taking advantage of the distressed valuations that many clubs were forced into by the pandemic and the loss of ticket revenues. In the last two years, CFG has added a majority stake in Italy's Palermo FC, Belgium's SK Lommel and France's ESTAC Troyes to a portfolio that already included MLS franchise New York City FC and other clubs in Sichuan, China, Yokohama and Melbourne, Australia.

The FT didn't give any details about the valuation of the deal. Silver Lake had first acquired a stake of 10% in CFG in 2019 at a valuation of $4.8 billion. 

The financial clout behind Manchester City has transformed the fortunes of a club long overshadowed by its more famous neighbor, Manchester United. It has won five English Premier League titles since Sheikh Mansour first invested in it, and is also the early leader in the current Premier League season. City now tops Deloitte's annual rankings for revenue among global soccer clubs.