Tottenham takeover hint as five potential buyers hold talks in America

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There is a finite pool of investors or institutions that can afford to buy into a club like Tottenham, with Daniel Levy having announced the search for fresh capital earlier this year.

In Spurs’ accounts for 2022-23, which was a record-breaking turnover year, the chairman and co-owner wrote: “The board and its advisors, Rothschild & Co, are in discussions with prospective investors.”

It later emerged that ENIC value Spurs at £3.75bn and are likely looking to sell a 10-15 per cent stake, although that range is not not set in stone.

While the club’s confirmation that it is looking for investors made plenty headlines in April, it has in reality been their position for some time.

Levy in particular has said that, as they have 30,000 shareholders who own around 13 per cent of the club, it is run as if it were a public company with a fiduciary duty to explore investment proposals.

Granted, actively engaging the Rothschild bank to smoke out would-be buyers is a step forward – but that does not mean that a huge partial takeover of Spurs is imminent.

The Premier League acquisitions market is somewhat saturated at present, with Everton set for a full takeover while West Ham and Crystal Palace are looking for significant minority investment.

One sector is increasingly linked whenever an investment opportunity arises: United States private equity.

And the latest developments in America show how serious these investment firms are about going all in on sport.

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Spurs will have eye on NFL talks

Spurs already have a close relationship with America’s National Football League through the London Games series, which they host at the Tottenham Hotspur Stadium.

The NFL paid £10m towards the initial construction costs of the world-class arena, plus a rental fee and a cut of catering revenue for every match played there.

Spurs also have a formal relationship with Formula One, whose Liberty Media owners have been linked with investing in the club and run the F1 Drive experience at the stadium.

The commercial and institutional ties between football and other sports are tightening, a trend expected to intensify as private equity expands its influence.

Spurs will therefore be watching closely the talks taking place between seven private equity firms and the NFL currently taking place, as relayed by Sportico.

The NFL does not currently allow institutional investment in its franchises, the only major United States-based league not to do so.

However, these discussions could open the door for private equity firms to buy from five to 10 per cent of NFL teams, whose average value is around £6bn.

Arctos Partners, Ares Management and Sixth Street have all held individual sessions with the NFL, as have a consortium encompassing Blackstone, Carlyle, CVC and Dynasty Equity.

Ares Management, Sixth Street and Carlyle were all reportedly in contention to invest in Man United before Sir Jim Ratcliffe bought his 27 per cent stake in the club.

Arctos meanwhile have a significant stake in Paris Saint-Germain as well as in Liverpool owners Fenway Sports Group, while Dynasty Equity bought a stake in Liverpool themselves in September last year.

It is inconceivable that the remaining four companies – who don’t represent a conflict of interest – have not been at least contacted about investment in Spurs.

A condition of the talks was that the private equity firms in question had ‘committed funds available today’ for investment.

That liquidity bodes well for a potential minority investment in Tottenham too.

The groups are set to meet again next Tuesday (27 August).

How much are Tottenham worth?

Spurs’ £3.75bn valuation has raised some eyebrows in the world of sports business.

For context, when Chelsea were sold to Clearlake Capital and Todd Boehly two years ago, they were valued at £2.5bn.

But Spurs already have the infrastructure in place with the stadium, whereas it is recognised that Chelsea need significant investment.

A multiplier of six or seven times turnover is used by some analysts to determine club value – and that would appraise Spurs at around £3.3-3.85bn.

Amanda Staveley’s PCP Capital Partners have been linked with Spurs having raised £500m for a new football investment.

£500m would be roughly equivalent to a 15 per cent stake at that value, although PCP are also believed to be looking at AS Monaco and other clubs.