Both the National Football League and Major League Baseball have recently acquired small equity stakes in Fanatics Inc., according to Sports Business Journal.
The NFL paid $95 million for a 3 percent stake while the MLB acquired a 1.5 percent stake for $50 million.
The NFL deal was approved at its owner meeting in late March. Sources Sources said the NFL was encouraged to make the deal after hearing MLB had earlier acquired a 1.5 percent stake for $50 million. Sources also told the business journal that the NFLPA had invested $5 million for less than a 1 percent stake in Fanatics.
As the dominant sports licensing player with retail’s big shift to e-commerce, the league’s owners were also attracted to Fanatic’s high valuation. The NFL’s price sets The prices sets a valuation on Fanatics at $3.17 billion, more than double its revenue level of $1.4 billion reached in 2016
By comparison, Dick’s Sporting Goods has a market capitalization of $5.8 billion versus sales of $7.2 billion.
“There’s a lot of upside for Fanatics,” one NFL ownership source told the Sports Business Journal. “I could see them growing anywhere from eight to 10X. It just made sense from an investment standpoint.”
Image courtesy Fanatics
