SBD/January 21, 2011/Media

Private Equity Firms Interested In MLBAM Reportedly Getting Cold Shoulder

Private equity firms are “hot for a stake in MLB Advanced Media, but the company's directors re-affirmed in a board meeting last week that they aren't looking to sell,” according to a source cited by Nicholas Carlson of BUSINESS INSIDER. MLBAM is viewed as "in-play" in private equity circles “mostly because of its awkward cap structure; it's owned in equal parts by all 30 MLB teams.” Private equity investors “figure those team owners -- and MLBAM management -- would like some liquidity.” Their pitch is “for the teams to give up some or even all of their ownership stake in exchange for perpetual revenue share,” and the new company “would get a perpetual license to show MLB games.” A source said MLBAM gets a "call a day" from private equity firms, but indicated that it “isn't looking to sell a stake for a few reasons." MLBAM reportedly believes that "selling a billion dollar stake in MLBAM any time soon would make it very hard for owners to argue that they're broke in upcoming labor negotiations with players.” A source said that “most of the biggies” are calling MLBAM, including TPG, Blackstone, Bain Capital, Elevation, Spectrum and Quadrangle (BUSINESSINSIDER.com, 1/19).
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