Private equity likes the long ball
The San Francisco Giants, one of Major League Baseball’s most successful franchises, have sold about 10 percent of the team to the private equity group Sixth Street, Ken Belson and Lauren Hirsch are first to report.
The team will use the cash to help pay for upgrades to the franchise’s 25-year-old stadium and other facilities, as well as the Mission Rock real estate development adjacent to the ballpark.
Details of the purchase, which was approved by Major League Baseball Monday, were not disclosed. But the team was last valued at $3.8 billion by Forbes. The Giants are owned by a syndicate of 35 owners, led by Greg Johnson.
Private equity has been making bolder investments in sports teams and properties. Live sports is one of the few products still attracting big audiences, driving up the valuations of teams out of reach of many individual investors. This has led all of the top pro leagues to invite big funds to invest in teams.
Baseball was the first major league in North America to welcome major funds. Now, more than half of Major League Baseball’s 30 teams, including the Boston Red Sox and the Chicago Cubs, have relationships with private equity groups.
Arctos, another private equity firm, owns about 2 percent of the Giants, as well as stakes in the Houston Astros, the San Diego Padres and other teams.
Streaming has made sports a global bet. And investors are eager to tap into the global appeal of sports. “Technology has changed the game, it’s broken down barriers,” Alan Waxman, the C.E.O. of Sixth Street, told DealBook, referring to streaming services and other products that have allowed fans to follow teams across the world.
Major League Baseball has embraced digital distribution. It sells streaming passes for the entire season, both domestically and internationally, and a growing number of teams are starting their own streaming platforms.
Sixth Street also has investments in the N.B.A.’s San Antonio Spurs and the European soccer clubs F.C. Barcelona and Real Madrid, and owns a controlling interest in Bay F.C., a women’s soccer team in the fast-growing N.W.S.L.
The Giants, who began play in 1883 in New York, are also one of the most recognizable baseball teams internationally. And while baseball is navigating its own challenges as it deals with changes to the media landscape — ESPN recently opted out of its rights deal with the league — The Giants have a deal with Comcast that extends through 2032.
“We want franchises that can have global appeal because we think those ones will be in the best position in the world we’re headed into,” Waxman said.
Since the current ownership group took control of the Giants in 1993, the team has had the eighth-most wins, three World Series titles and nine playoff appearances. Oracle Park, with views of the San Francisco skyline and bay, is considered one of the best in the league, and the team consistently draws more than three million fans a season.
The deal is also a bet on San Francisco. Oracle Park, which sits on just 12 acres, is now a quarter-century old and needs a face-lift. Over the next three years, the team plans to enhance the stadium’s main entrance facing Willie Mays Plaza, add designated sections for rooter clubs akin to those in soccer stadiums and upgrade and expand premium sections that include all-inclusive food and drink service.
The team will also invest more in its training facilities, including its complex in Scottsdale, Ariz., and the Mission Rock neighborhood being developed just south of the stadium.
“New capital is necessary in today’s world,” said Larry Baer, the team’s longtime president and C.E.O.
“This is not about a stockpile for the next Aaron Judge,” he said, referring to the New York Yankees star. “This is about improvements to the ballpark, making big bets on San Francisco and the community around us, and having the firepower to take us into the next generation.”
HERE’S WHAT’S HAPPENING
Alphabet is poised to announce its biggest takeover. Google’s parent company could announce a more than $30 billion deal for Wiz, a provider of cloud security services, as soon as Tuesday, according to news reports. The transaction would be Alphabet’s second run at Wiz, after it failed to buy the company last year at a $23 billion valuation. One question: The previous deal effort failed because of concerns about antitrust scrutiny — has the calculus changed under the Trump administration?
Harvard will make tuition free for more students. The university said that the plan would apply to students whose families make $200,000 or less, matching other schools including the University of Pennsylvania, M.I.T. and Caltech. Such moves, which come in the face of pushback from the Trump administration, are aimed in part at increasing diversity. Separately, many universities, including Harvard, are rushing to raise money in the bond markets before potential funding cuts by President Trump.
SpaceX’s Starlink is now available across the White House. Administration officials said Elon Musk’s satellite internet service was donated to the Trump administration, The Times reports. The system is meant to improve internet access across the complex, though some experts questioned the security of the arrangement. Separately, a SpaceX capsule is ferrying home two astronauts who have stayed at the International Space Station months longer than expected.
Hong Kong and Chinese leaders question BlackRock’s big ports deal. The leader of Hong Kong, John Lee, said that the transaction, in which the Hong Kong conglomerate CK Hutchison would sell most of its ports, including two around the Panama Canal, to a group led by BlackRock deserved “serious attention.” His remarks come after criticism of the agreement by Beijing over its potentially depriving China of influence over key shipping routes. The comments suggest yet more geopolitical blowback to a deal that was partly aimed at allaying the Trump administration’s concerns about control of the Panama Canal.
Europe wants to reverse a huge “capital flight”
While America’s once high-flying stock market is in turmoil, Europe’s markets are faring much better. Shares in European companies have vastly outperformed the S&P 500 despite the potential damage of President Trump’s trade war.
Officials in Brussels say that the rally could be even bigger. The European Commission, the European Union’s executive arm, is set to introduce a proposal Wednesday to tap trillions of euros parked in Europeans’ savings accounts to invest in Europe Inc., according to a draft proposal viewed by DealBook.
A second objective of the draft proposal: Encourage consolidation among European asset managers, a sector Wall Street has long overshadowed.
It is part of a larger vision to shake up the region’s byzantine capital markets, an effort that has taken on new urgency since Mr. Trump’s re-election.
“It’s because of Trump, but also the need for more integration in so many sectors,” Fabrizio Pagani, a partner at the investment bank Vitale and a former top economic adviser to the Italian government, told DealBook. “There is so much positive catch-up to do.”
The plan is also meant to address an issue that bugs many European officials: That European retail and institutional investors put roughly €300 billion ($328 billion) annually into stocks and other assets based outside the European Union. “This is capital flight, and mostly to the U.S.,” Pagani said.
That drain deprives European companies of capital needed to invest, innovate and grow. At the same time, Europe is scrambling to raise vast sums to improve its economy — and, in a sudden new priority, rearm as Trump threatens to cut off military support to Ukraine.
Consider the global flight to Nvidia. Late last year, the chip-making giant at the center of the artificial intelligence boom saw its market capitalization soar above $3.6 trillion — surpassing the entirety of Germany’s blue-chip Dax 40.
Nvidia’s run made it a top holding for some European pension funds. And the desire to cash in on the U.S. tech stock surge became a recurring discussion point at investor road shows across Europe late last year, analysts told DealBook.
The bloc’s draft plan to reverse that money flow involves a savings and investment union:
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Advisers to the commission want to see member states cut “unnecessary” red tape in any consolidation among the continent’s army of asset managers, which are vastly outgunned by U.S. giants like BlackRock, Vanguard and Fidelity.
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They are also calling for introducing tax breaks for investors and pension funds, especially those who put their money into European financial assets — not just stocks, but in bonds and venture funding for private companies.
Creating a true investment union faces major hurdles. The European Union has 295 national trading venues and a hodgepodge of national regulators and investment rules and taxes. This measure falls short of producing a single market watchdog, equivalent to the S.E.C., that could create and enforce a common rule book.
Europe’s fragmented investment market is one reason that’s cited for top European start-ups to go public in the United States. What’s expected to be one of the year’s hottest I.P.O.s, the Stockholm-based lender Klarna, will list on the New York Stock Exchange in the coming weeks.
“I want to give away a million dollars to somebody while I’m still around as chairman.”
— Warren Buffett, who is tweaking the rules of Berkshire Hathaway’s internal March Madness bracket to make it more likely that someone will win the big prize.
What to watch at the Super Bowl of A.I.
Investors will be watching closely for signs of reassurance Tuesday from Nvidia’s C.E.O., Jensen Huang. The chip magnate is expected to deliver the keynote at Nvidia GTC, the annual conference in San Jose, Calif., that is widely considered the Super Bowl of A.I.
His speech comes as the industry faces a weakening economy, a trade war and an unexpected challenge from the Chinese start-up DeepSeek. Huang’s job is to reinvigorate investor confidence in A.I.’s overarching thesis — you need to spend to grow.
Investors don’t seem terribly optimistic. Nvidia’s share price dipped almost 2 percent Monday before the event. Related tech companies, like Samsung and Dell, saw a bump.
The stakes are huge. Nvidia, the leading chip maker for A.I., commands an enormous market cap of nearly $3 trillion. It’s part of the so-called Magnificent Seven group of stocks that drives the S&P 500. When Nvidia sneezes, the market shudders.
The company still faces risks. Nvidia could face export controls that could severely dent sales, and Huang’s quieter approach to the Trump administration may not pay off.
Also, will Big Tech continue to spend on A.I.? Customers like Meta, Google and Amazon are starting to make their own chips.
Analysts expect two themes. First, be aware that Huang’s keynotes can drag on for two hours or more.
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New chips. Huang has promised more details about the company’s upcoming Blackwell Ultra chip, and a new A.I. super-chip, Vera Rubin, named after the astronomer who discovered dark matter. The Rubin line could deliver performance as much as 30 times as fast as that of its predecessor.
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A.I. will deliver. Some question whether the technology can generate enough revenue to justify its steep costs, and if Nvidia’s sales have peaked. Huang is likely to highlight the budding consumer market. For example: A.I. agents can power services people will want to pay for.
Will Huang address DeepSeek? The Chinese newcomer’s breakthrough — using far fewer chips than its competitors to create a similarly powerful generative A.I. model — cleaved off $600 billion of Nvidia’s market value in a single day. There’s a counterargument that lower development cost will mean more buyers of Nvidia chips, not fewer, but concerns of a drop off in spending have continued to weigh on the stock.
THE SPEED READ
Deals
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“Short sellers make $16 billion profit from Tesla’s share price plunge” (FT)
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Scoop: Apptronik, a maker of humanoid robots, has expanded its Series A fund-raising round to $403 million; investors include Mercedes-Benz, Japan Post Capital and ARK Invest. (DealBook)
Politics, policy and regulation
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The acting chair of the Equal Employment Opportunity Commission sent letters to 20 law firms — including Perkins Coie, Kirkland & Ellis and Sidley Austin — demanding information about their diversity, equity and inclusion-related employment programs. (NYT)
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Crypto executives are targeting the S.E.C. as payback for a crackdown during the Biden administration, including pushing law firms to shun hiring former agency staff members. (Politico)
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World Liberty Financial, the Trump family’s crypto venture, said it has raised $550 million to date in digital token sales. (CNBC)
Best of the rest
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