Atlético Madrid’s new owner is one of the great monsters of international finance. Apollo Global Management, which will have majority control of approximately 57% of the Madrid team, is a leading investment management company. The company is dedicated to collecting savings from its customers (mostly other funds, pension plans, and large assets) and providing returns that are higher than the stock market.
Headquartered in New York and founded in 1990 by partners Leon Black, Josh Harris and Mark Rowan, the company is a world leader in international markets with approximately $1 billion under management. The firm is one of the leading players in this type of investment, ranging from venture capital to fixed income, in place of traditional products, along with other US companies such as Blackstone and KKR and Canada’s Brookfield.
How do these funds work?
This business is not just an injection of capital, but the entry of one of the world’s top venture capital firms, which has become a central player in the financial industry in recent years. They are companies with limited investment scope. It operates by acquiring companies, both non-listed on the stock market (such as Atlético de Madrid) and listed ones (such as major ITV company Aplus), and then selling them later. In addition to having customer funds, they also have the ability to borrow money (usually at the acquired company’s expense), so they have large amounts of capital.
The usual objective is to hold onto the investment for a limited period of time (usually 5 or 7 years) and either sell it to another investor or list the company on the stock market and return the funds to the customer at a higher price plus market interest. Companies like Apollo have also expanded their interests, in other cases acting as lenders or in the infrastructure and energy sectors for a longer period of time.
The sector has experienced explosive growth over the past decade thanks to low interest rates and strong demand from end investors. These executives (mostly American, but also from the UK, Canada, Sweden, and France) are therefore extending their tentacles into key economic areas such as infrastructure, healthcare, the real estate sector, energy, and food.
Who owns Apollo?
The company is a multinational company listed on the New York Stock Exchange with a market capitalization of approximately $77 billion (approximately 66 billion euros). As is the case with many large publicly traded companies, its main owners are investment fund managers. Capital Group (8.5%), Vanguard (8.2%), and BlackRock (5.8%). However, the three founders also maintain stakes ranging from 5.9% to 6.6%. Atlético Madrid’s new shareholders have offices in major cities in North America, Europe, including Madrid, and Asia. In reality, the funds to buy Atlético Madrid came from the end investors, but the team will be managed by the fund manager, who will aim to get the most out of his investment.
Role in sports
The coach has already invested more than $17 billion in various businesses related to soccer clubs, media rights and stadium financing. Last September, Apollo Sports Capital (ASC) was launched as Apollo’s platform dedicated to investing in the sports sector, with an investment capacity of approximately $5 billion (approximately €4.3 billion). ASC seeks to invest in credit and hybrid (credit and real estate) opportunities in franchises, leagues, venues, media, and sporting events. ASC is led by CEO Al Tylis. co-managers Rob Gibborn and Lee Solomon; and Sam Porter, Director of Strategy.
Atlético Madrid will be the main investment destination with a majority stake in ASC and will not be part of Club Control’s timeshare strategy. Other recent investments by Apollo Sports Capital include the Mutua Madrid Open and the Miami Open tennis tournament.
As well as being interested in buying Manchester United, Apollo have also financed other teams in the Premier League, most recently signing an £80m loan deal to Nottingham Forest, according to reports.
Presence in Spain
In Spain, Apollo is behind Neinor’s acquisition of Aedas, with the aim of creating Spain’s largest promoter. Together with Naynor, Castle Lake wants to take over 79% of the listed shares in Adas Homes. In the tourism sector, the company entered the Spanish hotel industry in 2019 with the aim of acquiring a relevant portfolio, which it ultimately achieved through the acquisition of six properties, which it is currently seeking to complete the maturation process of its business and sell. It also owns a 49% stake in transportation giant Primafrio, which the Conesa family founded after its initial public offering failed. In the financial sector, it acquired Evo Banco from Nova Galicia in 2013 and sold it to Ban Inter six years later.
One of the company’s best-known ventures in Spain was its nearly 700 million euro acquisition of an 85% stake in Altamira, which controlled Santander’s assets and troubled loans. The company then sold its stake to the Bank of Italy, controlled by another venture capital firm, Fortress, a common practice, marking a milestone in the management of the country’s debt and asset portfolios. The firm was also involved in a takeover battle for ITV services specialist Applus, but ultimately pulled out after proposals from two other funds in the sector, TDR and I Squared.
What is Apollo investing in in other parts of the world?
Apollo has assets in almost every sector and is one of the other benchmark brands. In 2021, Apollo acquired approximately 90% of Verizon Media, which includes the iconic Yahoo! And AOL. In distribution, Apollo Corp. just withdrew its $2 billion takeover offer for the Papa John’s pizza chain. One of the company’s lesser-known but important assets is Athene, an insurance company specializing in retirement and pension services. Its importance lies in the fact that it provides Apollo with a large and stable long-term capital flow through the insurance premiums that management uses to finance investments in credit and private equity. More than 5,200 Apollo and Athene employees, including more than 860 investment professionals, work in Apollo offices around the world.
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