Silver Lake, the technology-focused private equity firm known for investing in Alibaba Group, Broadcom and Dell, has made a strategic investment in the Oak View Group, an entertainment and sports facilities company. The investment, reportedly for $100 million, is designed to support OVG's growth strategy, including arena development projects and other strategic initiatives.
OVG was recently awarded the right to redevelop Key Arena in Seattle with partners TPG Capital founder David Bonderman and film and TV producer Jerry Bruckheimer, and was an integral part of attracting a National Hockey League expansion team to the market for the first time, generating a deposit campaign of 33,000 tickets in less than two days, according to the company. Los Angeles based OVG plans a $600 million renovation of the arena, aiming to have the 56-year-old arena renovated in time for the 2020-21 hockey season.
Silver Lake's role as a leading investor in technology may make OVG a good fit, as state-of-the-art technology will play an important role in Key Arena's redesign. The rebuilt arena will be aimed at enticing the Seattle area's high-tech workforce from companies including Amazon Inc. (Nasdaq: AMZN) and Microsoft Corp. (Nasdaq: MSFT) to concerts, atheltic events and other performances.
“We want to do our best to make this the most tech savvy arena that’s been built anywhere at any time, what exactly that’s going to look like, we don’t know,” Bonderman told GeekWire in an interview earlier in March.
"Technology's impact on the global media and entertainment sectors has created new opportunities for OVG," said Lee Wittlinger, managing director at Silver Lake, in a statement. "We firmly believe that OVG is positioned to become a world-class franchise in sports and live events."
OVG has also partnered with New York Mets COO Jeff Wilpon and the NY Islanders to form a group that was awarded the right to build a new arena for the Islanders adjacent to the Belmont Racetrack in New York. Additionally, OVG has recently entered the facilities management business through its acquisition of Pinnacle Facility Management, and also owns and operates trade publications Venues Now and Pollstar.
"In less than three years, Oak View Group has made a significant positive impact on the sports and entertainment facilities landscape," said OVG CEO Tim Leiweke in a statement. "I am very proud of what we have accomplished in such a short time. This deal with Silver Lake provides us with capital to continue to grow our business as well as invaluable expertise and relationships. I am thrilled to have them as my partner."
OVG was founded in 2015 by Leiweke, whose previous roles include chief executive of Maple Leaf Sports & Entertainment and Anschutz Entertainment Group, and Irving Azoff, the legendary manager of the Eagles who serves as the CEO of Azoff MSG Entertainment, a joint venture with The Madison Square Garden Co. OVG was conceived as a "positive disruptor" in sports and entertainment. The company currently has more than 200 employees across offices in Los Angeles, Seattle and New York City. OVG's business divisions include OVG Business Development, OVG Global Partnerships, OVG Media and Conferences, OVG Facilities, Prevent Advisors and the Arena and Stadium Alliance, a group of top U.S. venues.
In late 2017, OVG was reportedly among the bidders for SMG Holdings, which owns Houston’s NRG Stadium, Chicago’s Soldier Field, US Bank Stadium in Minneapolis, and the Chesapeake Energy Arena in Oklahoma City. Toronto private equity firm Onex bought the company in a deal that closed in January.
"Sports-industry insiders believe buyout firm Silver Lake Partners is working on a master plan with James Dolan that, one day, could help him buy Madison Square Garden — and maybe even the Knicks or Rangers," reports the New York Post. The news organization points out that Silver Lake disclosed a 6.3 percent stake in the Madison Square Garden Co. (of which Dolan is the executive chairman) in a recent 13D filing, indicating an activist position. The Menlo Park, California, investment firm said it would like to help MSG create long-term value.
Silver Lake is a global leader in technology investing, with approximately $39 billion in combined assets under management and committed capital and a team of approximately 100 investment and value creation professionals located in Silicon Valley, New York, London, Hong Kong and Tokyo. Silver Lake's portfolio of investments collectively generates more than $140 billion of revenue annually and employs more than 300,000 people globally. The firm's current portfolio includes leading technology and technology-enabled businesses such as Alibaba Group, Ancestry, Broadcom Limited, Cast & Crew, Ctrip, Dell Technologies, Endeavor, Fanatics, GoDaddy, Motorola Solutions, Red Ventures, Sabre, SoFi, SolarWinds, Symantec, UFC and Unity.
In 2017, Silver Lake raised $15 billion in capital to back new tech deals. The fund, called Silver Lake Partners V, is the private equity firm’s fifth buyout fund.