PROVIDENCE – Providence Equity Partners LLC has sold its interest in Major League Soccer’s media and marketing arm back to the league, which is eager to capitalize on the growing interest in United States soccer around the world.
The private equity firm tripled its initial investment in Soccer United Marketing, according to people familiar with the accounting. Providence Equity paid $150 million for a 25 percent stake in 2012. Six teams have joined MLS since then, diluting Providence Equity’s original share.
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“By combining the most popular sport in the world with the largest media market in the world, we knew MLS had a unique opportunity,” said Jonathan Nelson, founder and CEO of Providence Equity Partners.
SUM is the latest sports-related holding shed by Providence Equity, which is building a strong record of returns on sports investments. The company recently tripled its investments in the sales of Learfield Communications Inc. in 2016 and World Triathlon Corp. in 2015, according to people with knowledge of the matter.
Providence Equity had been the only outside investor in SUM, which has grown into the media, promotional and marketing arm for MLS, the U.S. Soccer Federation and other North American soccer entities.
By taking complete ownership of SUM, the league and its owners will no longer have to share the profits generated by the buying and selling of broadcast rights and corporate sponsorships, which are rising along with the popularity of soccer, and particularly MLS.
“We are a healthier and stronger business because of Providence [Equity]’s investment,” MLS Commissioner Don Garber said in a statement.
The league is still growing. Twelve groups and markets have submitted applications for the next round of expansion. MLS will add four more expansion teams in the coming years, growing to 28 clubs.
The average MLS team is worth $185 million, according to Forbes’s 2016 estimates, up 18 percent from 2015 and 80 percent from 2013. The Seattle Sounders are the league’s most valuable club at $285 million, Forbes said.
Scott Soshnick and Kiel Porter are reporters for Bloomberg News.
