Goldman, CIC Back Concessions Launch
Goldman Sachs teams up again with the Yankees, following up on its past partnership to launch the YES Network.
October 20, 2008
Goldman Sachs has already scored once betting on The New York Yankees. The firm, along with mid-market private equity group CIC Partners, is making another wager, teaming with both the Yankees and football franchise The Dallas Cowboys to launch a hospitality and merchandising services provider to be known as Legends Hospitality Management.
The company, which will be headed by former Pizza Hut president Michael Rawlings, will initially focus on catering, concessions, retail merchandising and other facility management for major sports and entertainment facilities. The company, as the investor group would suggest, has been given the exclusive right to manage the concessions and merchandising at the homes of both the Yankees and the Cowboys.
The new 52,000-plus seat Yankee Stadium is set to open on April 16, 2009, while the new Cowboys stadium, which will accommodate over 80,000 people, is set to open for the 2009 NFL season. According to a press release, the company anticipates lining up other facilities that cover both professional and college sports, as well as other events worldwide.
“The old model of stadium concessions is broken,” Hal Steinbrenner, co-Chairman of the New York Yankees, said in a statement. “Fans want and deserve a better experience for their sports entertainment dollar.”
Centerplate had managed concessions at Yankee Stadium previously, while the Cowboys had handled it in-house. Centerplate, marketwatchers may remember, had turned down an $13.50-per-share offer from Wellspring Capital Management to go private. It’s stock was trading at under $3.00 a share as of press time.
For Goldman Sachs, the new effort reunites the firm with The Yankees, as Goldman was a minority investor when the team launched The Yes Network in 2003. The investment, in addition to serving as an investor, will also provide financing for the effort, along with CIC, and both served as advisers on the launch.
Goldman has invested in the concessions space before. Last year, its PE affiliate, GS Capital Partners, teamed with CCMP Capital Advisors, JPMorgan, Thomas H. Lee Partners and Warburg Pincus to buy Aramark in an $8.3 billion deal.
For more information on related topics, visit the following:
