A global investment firm which previously injected hundreds of millions of pounds into Chelsea has announced a gigantic deal with an American football franchise.
Ares Management reached a huge cash agreement with Chelsea in 2023, which the Financial Times said totalled $500million (£392m). The Blues had spent more than £1billion on transfers throughout 2023 and so the report claimed owners Todd Boehly and Clearlake Capital were looking to re-bolster finances.
In April, the club announced it had recorded losses of £90m for the 2022/23 season, just months after reports of the deal emerged. A record £75m had been paid the player agents.
Ares has assets worth more than $464bn (£363bn) via investments in areas such as real estate and infrastructure, to name a few. The company has offices across four continents, including one in London.
On Wednesday, it was announced that Ares had agreed to the purchase of stakes in NFL giants the Miami Dolphins. The business has taken a 10 per cent share with owners of basketball franchise Brooklyn Nets, Joe Tsai and Oliver Weisberg, acquiring three per cent stakes.
"The Miami Dolphins represent an iconic franchise with a deeply engaged fanbase, and Ares is honored to invest alongside Joe and Ollie to support the team's long-term strategic goals," said Mark Affolter and Jim Miller, heads of Sports, Media & Entertainment at Ares.
Chief football finance expert at Reach PLC Dave Powell has detailed the extent of Ares’ impact on Chelsea’s own football remit and why the business has invested in an NFL organisation.
He said: “Ares’ investment in Chelsea arrived in September 2023 via a preferred equity deal, the sum reportedly around £392m.
“Preferred equity is often used in relation to real estate projects, and that is what the sum raised by Todd Boehly and Clearlake Capital was earmarked for, with the club having one eye on the future when it comes to stadium plans. The ability to invest further in the BlueCo multi-club model was also a part of the desire to raise capital.
“Ares have experience in football being an investor in French Ligue 1 side Olympique Lyonnais, a club owned by Crystal Palace part-owner John Textor.
“Their move into taking a minority stake in an NFL team was entirely expected given they were one of the private equity firms to get the green light from the NFL to do so when it was agreed that the league would open itself up to the sale of small stakes to investment funds, having previously only been able to have ownership via family offices and high-net-worth individuals.
“The decision was part of the NFL’s plan to see more money flood into America’s biggest sporting league, and aid its growth and continued high watermark valuations of its teams.
"Ares have joined other investors such as Arctos Sports Partners, who have an indirect stake in Liverpool via Fenway Sports Group, as well as a minority position in Paris Saint-Germain, and Liverpool minority stakeholders Dynasty Equity in entering the NFL space this year.”