Arctos Sports Partners, the US investment fund that holds a minority stake in Liverpool owners Fenway Sports Group, has acquired a $36m (£29.2m) stake in Italian top flight side Atalanta.
Arctos, who took a small stake in FSG in 2020, have added to their ever-increasing portfolio of sporting investments with a minority stake in the Bergamo-based Serie A side, who have played Champions League football for each of the last three seasons.
Through direct and indirect investments Arctos now has stakes in Liverpool; the Boston Red Sox MLB side; the Pittsburgh Penguins, Minnesota Wild and Tampa Bay Lightning NHL teams, as well as the Golden State Warriors and Sacramento Kings NBA franchises.
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Founded by former private equity strategist Ian Charles and ex-Madison Square Garden executive David O'Connor, Arctos added a familiar face to their management team at the start of last year, bringing on board a trusted former FSG lieutenant in Theo Epstein, a man who helped deliver success for FSG supremo John Henry at the Red Sox, to advise on strategy. Epstein was a former vice president and general manager of the Red Sox and credited with playing a major role in delivering success to Boston for the first time in 86 years following FSG's 2002 takeover of the team and their subsequent 2004 World Series win.
There are those well placed in the US who have suggested to the ECHO previously that Epstein could well have a larger role to play within FSG in the future when Henry and FSG and Liverpool chairman Tom Werner decide to either step aside or dilute their involvement, suggesting the same of both 11 per cent FSG stakeholders RedBird Capital Partners and Red Sox president Sam Kennedy, both seen as key figures in FSG's long-term future.
In his role as executive-in-residence, Epstein will be tasked with 'advising owners of the teams Arctos invests in, across multiple leagues, on matters such as organisational leadership, culture-building and other business areas'.
Owing to regulation, firms such as Arctos must not have a conflict of interest and must be passive, meaning Epstein won't have a role in roster building, pay roll or on field matters within an franchise or team associated with their investment fund.
Arctos' investment in Atalanta, first reported by US sports business website Sportico, sees their prolific streak continue. They are, however, a different type of investor than Gerry Cardinale's RedBird, who acquired 11 per cent of FSG in March 2021 for $750m and who have ownership of French side Toulouse, stakes in Indian Premier League cricket side Rajasthan Royals, Spanish second tier side Malaga, ownership of the XFL and are in the race to acquire full ownership of Italian giants AC Milan from Elliott Management.
Where RedBird are active investors, bringing both capital and expertise to the table in a bid to play a participative role in growing a business, coining themselves as 'business builders', Arctos are more passive investors, their influence not often stretching beyond providing capital to help growth and then taking a back seat and seeking a return on their investments. The latest move to take a considerable stake in Atalanta will likely follow that trend.
Atalanta were acquired earlier this year by a consortium that was led by Boston Celtics co-owner Stephen Pagliuca, who had been one of the early runners in the race to take over at Chelsea.
Arctos are one of a number of private equity funds who have invested heavily into sport in the past two years, believing that team valuations will continue to rise thanks to the continued upward trajectory of media rights and new revenue streams that are coming on board in sport such as cryptocurrency, blockchain and NFTS.
