ESPN sells majority stake in X Games to private equity firm for $325 million Sports network ESPN has sold a minority stake in X Games to a private equity firm for $325 million, its largest-ever acquisition by a single investor. X Games, which is under a multi-year broadcast contract with ESPN, will continue to be run with the assistance of ESPN, the network said in a statement. The X Games, which have been held in Phoenix since 1996, have a current annual revenue of $300 million and are profitable, according to ESPN.”We fully support the growth and success of X Games and support their goal to be a truly global event,” ESPN chief operating officer Peter Chiarelli said. “The sale of a minority stake in X Games will help us to grow the company but also take advantage of the unique opportunity to create a new sports entertainment brand that will live beyond our current five-year agreement with X Games.” The purchase announcement came with the agreement of six investment partners, including Bain Capital, General Atlantic, Golden Gate Ventures and Sequoia Capital. The deal is expected to close in the first quarter of next year and ESPN will use its cash from the transaction to build an overall investment portfolio. Sports network ESPN has been on the hunt for investment partners for several years and has explored several avenues to enhance its portfolio, including an equity investment, a strategic partnership and a private equity investment.
The sale value is not disclosed but sources said that it was in the six-digit range. X Games is the second-largest annual event among sports events after the National Hockey League (NHL). It has more than a million spectators in the Phoenix area, which makes it one of the largest events at an individual venue.
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As part of its larger investment, Bain Capital will give ESPN $300 million, all of which will be in cash. General Atlantic, Golden Gate Ventures, and Sequoia Capital will all give ESPN $100 million, all of which will be in cash.
This is ESPN’s first sale of a minority stake in a company since the departure of minority partner Warren Spector in 2008.
The company said that it did not expect the deal to impact the X Games’ profits, and that the sale is expected to close in the first quarter of next year.
The network has run X Games since their beginning, starting under