Man City’s US investors Silver Lake went from a tech company who put money into Dell and WME to Premier League owners
THIS really could be a Hollywood story, if there’s a fairytale ending. In May last year, William Morris Endeavor impresario Ari Emanuel introduced his pal, Egon Durban, a Silicone Valley brainiac and managing partner of a private tech equity firm called Silver Lake, to Khaldoon Al Mubarak. Just six months later and the Manchester City […]
THIS really could be a Hollywood story, if there’s a fairytale ending.
In May last year, William Morris Endeavor impresario Ari Emanuel introduced his pal, Egon Durban, a Silicone Valley brainiac and managing partner of a private tech equity firm called Silver Lake, to Khaldoon Al Mubarak.
Just six months later and the Manchester City chairman and the 46-year-old American investor were inking a deal worth around £369MILLION, that gave Silver Lake a 10 per cent share in the Premier League champions.
The timing couldn’t be more perfect. With City facing the probability of two seasons out of the Champions League, incoming revenue will be down.
But, as SunSport EXCLUSIVELY revealed, Silver Lake’s investment should save the Citizens from drowning beneath the financial burden that’s been beseeched upon them by Uefa.
WHO ARE SILVER LAKE?
Founded in 1999 in the affluent Californian city Menlo Park, the company began by making private equity investments in seasoned technology companies, following the trend of the technology boom of the 1990s.
They were set up initially by Jim Davidson, Dave Roux, Roger McNamee and Glenn Hutchins, with Durban working as a principal founder.
McNamee left five years later to set up Elevation Partners with U2 singer Bono.
Durban’s primary focus was the tech market, which is why Silver Lake invested in computer giants Dell Technologies, as well as internet phone service Skype.
They’ve also did a deal with web hosting company GoDaddy Inc in 2011.
But, with Durban’s prowess with mingling with high society and boasting a contacts book that included entrepreneurs like Elon Musk, the entertainment world was about to become his oyster.
WILLIAM MORRIS ENDEAVOR
In 2012, Silver Lake made their first foray into showbiz.
They bought a stake in Ari Emanuel’s talent agency Endeavor, after it had absorbed William Morris.
The group famously look after A-list stars like Ryan Reynolds and Emma Stone, as well as tennis legends Serena Williams and Novak Djokovic.
Durban was at the forefront of that deal, realising the company had to expand its wings.
A source told the Financial Times: “He’s one of four managing partners at the most important technology private equity firm in the world.
“But he’s tried to reinvent himself as something more than that, someone whose contact book stretches from Michael Dell to Elon Musk to Ari Emanuel, who can make deals that rely on bringing unique combinations of people together.”
SPORT WAS ALWAYS ON THE AGENDA
For a company that has fingers in the pies of Donald Trump’s formerly owned Miss Universe beauty pageant, as well as the MMA franchise the UFC, they’re clearly good sports.
And Silver Lake reportedly wanted to branch out into football, primarily the Premier League because of its earning potential, for some time before their Manchester City investment.
The firm were believed to have assessed several of England’s top clubs.
One of those was said to be West Londoners Chelsea, until they went north and found an ear in Mubarak.
And there’s certainly a good reason why Silver Lake see the Premier League as the perfect fit for them.
They forsee an opportunity in football, which is being driven by trends in media and technology.
Being a football powerhouse, Manchester City benefit from television rights all around the world that swell the club’s coffers.
However, if/when a switch is made to online/pay-per-view viewing for individual games, the value of media rights will no doubt increase.
HOW CAN SILVER LAKE HELP CITY?
With over $43billion (£33bn) in combined assets under management and committed capital, Silver Lake are swimming in riches.
That’s how they could afford to pay their £369million investment into the City Football Group (CFG) in FULL in November.
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Although that’s not classed as revenue in terms of Financial Fair Play, that can offset any financial worries the club may have as an operation, should the Uefa ban be upheld.
Coupled with money from sponsorships and player sales, it means City shouldn’t be derailed financially, if they miss out on a predicted £160m windfall the Champions League could bring them over those two seasons.
It seems like Silver Lake have given City fans a taste of the unthinkable, just like a Hollywood studio could… which the firm knows well.
