The U.S. Tennis Association paid about $2 million for its stake in Tennis Channel, the USTA disclosed in its recently available 2006 tax filing.
The USTA announced the investment 12 months ago but has declined, along with Tennis Channel, to disclose the price. Public estimates have been far higher than $2 million, and just last week Tennis Week projected the investment at between $5 million and $10 million. Tennis Week is owned by IMG, which is also a Tennis Channel investor.
The USTA tax return shows that the group actually assigned a book value of $2 million to the Tennis Channel investment. Book value is the acquisition cost of an asset minus depreciation. The 2006 USTA tax return period ended just three weeks after the group announced the media investment, and it is unlikely that the acquisition cost would have depreciated in that limited period.
The USTA, which owns the U.S. Open, received an observer position on Tennis Channel’s board as part of the investment, which sources said represents a low single-digit percent of the broadcaster. Other Tennis Channel investors include Apollo Partners, DND Capital Partners and Bain Capital.
The USTA declined to comment, and Tennis Channel could not immediately be reached for comment.
