Arctos Partners has received NFL owner approval to acquire an initial 3 percent stake in the Cleveland Browns at a $9 billion valuation, with a stated intent to reach 10 percent. The deal comes weeks after KKR closed its $1.4 billion acquisition of Arctos.
Arctos Partners (Dallas, New York, London) will be adding to a portfolio of stakes in, let’s say, more than two dozen teams. The investment firm has received the approval of the NFL owners to take a stake in the Cleveland Browns.
According to Sportico, which cites “someone familiar with the details,” Arctos is seeking at first to purchase about 3 percent of the Browns at a valuation of $9 billion (presumed price: $270m), with a view toward purchasing 10 percent overall.
The Browns will be using the funds to help pay for a new stadium, costing an estimated $2.6 billion. Team owners Jimmy and Dee Haslam have pledged $1.76 billion toward the project, which implies a funding gap of $840 million.
Arctos has already purchased stakes, 10 percent apiece, in the Buffalo Bills and the Los Angeles Chargers.
In August 2024 the NFL approved a list of firms as potential investors: Arctos, Ares Management, Sixth Street and a consortium consisting of Carlyle Group, Dynasty, Ludis, Blackstone and CVC Capital Partners. According to Private Equity Wire, Blackstone and CVC split off amicably from the consortium last May, having failed to come to terms under the NFL’s ownership and governance framework.
Ares has acquired 10 percent of the Miami Dolphins and Sixth Street 3 percent of the New England Patriots. The consortium has yet to make a move.
Early this month the investment firm KKR (New York) closed its acquisition of Arctos, which would appear not to have affected the latter’s status as a firm approved by the NFL. According to the 8-K filed with the SEC, KKR agreed to pay an initial consideration of $1.4 billion. In addition, “equity of up to $550 million tied to both KKR share price and business-specific performance targets and subject to vesting through 2031 may be earned.”
According to KKR, Arctos is to become part of KKR Solutions, “a new investing business within KKR” that will include both of Arctos’ business lines – Sports and Keystone (PE, credit, real estate, digital infrastructure) – and “serve as the home of a scaled multi-asset class secondaries business KKR will build over time.”
Arctos holds minority stakes in, among others, Atalanta BC, Paris Saint-Germain, the Golden State Warriors, the Houston Astros and the Sacramento Kings.
