Ares Management to Debut Sports and Media Fund for Retail Investors
Global alternative investment manager Ares Management Corp. (NYSE:ARES) is launching a new media and entertainment fund targeting retail investors.
The company has begun talking to investors about the strategy, reported last week by Bloomberg, which will make debt and equity investments in sports leagues, teams and sports-related businesses, as well as media and entertainment companies.
Michael J. Arougheti, chief executive officer of Ares, told investors that financial advisers had requested such a fund and that it would potentially offer quarterly redemptions.
The move appears to be a logical next step for the behemoth company, which introduced its Ares Sports, Media, and Entertainment branch in February of this year.
“When we first identified this sector, we felt that it was very compelling from an asset class,” said Mark Affolter – partner, co-head of sports, media, and entertainment at Ares – on a video explaining the venture. “We liked the growth. We liked the activity. We felt it was a wide, addressable market opportunity.”
“The revenues tend to be very stable, reoccurring, and it’s really an under-invested asset class for institutional capital,” said Jim Miller, partner, co-head of sports, media, and entertainment at Ares.
Leadership said in February that in addition to sports teams, the branch seeks global opportunities with sports products and within businesses, youth sports companies, media and entertainment businesses, and scripted content companies.
According to a recent investor presentation, approximately 8% of Ares’s roughly $546 billion in assets as of the end of March were derived from semi-liquid wealth-related products, highlighting a broader industry trend of asset managers offering private assets to individuals.
The company has set an ambitious target to manage $100 billion from individual investors globally by 2028, a move that could generate an estimated $600 million in management fees.
The Los Angeles-based firm has significantly boosted its investments in sports. This includes acquiring stakes in prominent teams such as the National Football League’s Miami Dolphins, Major League Soccer’s Inter Miami CF, and the Premier League’s Chelsea Football Club.
Ares established its first dedicated sports strategy fund in 2022, successfully closing it with $3.7 billion. Earlier this year, the firm held a first close for its second sports fund, securing $1 billion from institutional investors and aiming to raise a total of $2 billion.
“While sports teams, clubs and leagues often draw much of the attention, we believe the broader potential ecosystem of sports, media and entertainment investing is significant and underpenetrated,” according to Ares’s website. The firm estimates the total investment opportunity in these “adjacent strategies” could reach as much as $2.5 trillion.
Click here to visit the AltsWire directory page.
