LeBron James, Red Sox owner
Yankees fan LeBron James is now a part-owner of the Red Sox following a restructuring of the team's parent company, Fenway Sports Group.
Behind the scenes: Red Sox majority owner John Henry has agreed to sell an 11% stake in FSG to private equity firm RedBird Capital Partners.
- FSG also owns Liverpool, Fenway Park, NASCAR team Roush Fenway Racing, and NESN, which airs Red Sox and Bruins games.
- In 2011, James acquired a 2% stake in Liverpool for $6.5 million (worth ~$40 million today). He's now using the Redbird-led shakeup to convert that stake into 1% of FSG. No new money is being invested.
By the numbers: It's an enormous return on investment for Henry, who in 2001 paid a then-record $700 million for the Red Sox. This deal values FSG at around $7.3 billion.
Between the lines: RedBird was originally in talks to buy between 2o–25% of FSG via SPAC in a maneuver involving Billy "Moneyball" Beane, Axios' Dan Primack notes.
- But that deal didn't come together, due to difficulties in obtaining outside financing at a valuation asking price of around $8 billion.
- RedBird is led by Gerry Cardinale, who has a history of making deals with sports teams. He helped the Yankees launch YES Network and recently bought the XFL with partner Dwayne "The Rock" Johnson.
The big picture: The deal will make James and business partner Maverick Carter the first Black owners of the Red Sox. James says his goal is "to own an NBA franchise," and his expanding relationship with FSG could eventually help him get there.
- "If LeBron retired tomorrow, he probably could put together a group with enough capital to buy an NBA team," an investment banker who has advised NBA team sales told ESPN (subscription).
- "The trick is finding a group that would put up that kind of money and allow him to be the controlling partner if he's not putting in the most money." That's where FSG could come in.
What to watch: The NBA recently opened the door for private equity funds (like RedBall) to buy minority stakes in teams, opening a potential path for James and other ex-players to own teams by becoming investors.
Editor's note: This story has been corrected to reflect that James and Carter are the first Black owners of the Boston Red Sox (not of any MLB team).