Everything That Could Change For the Yankees With Private Equity Deal

While the New York Yankees steadily make news on the field coming off their six-game road trip as they prepare for another postseason under manager Aaron Boone, the ownership group is also generating headlines.

Over the weekend, Chuck Gasparino of the New York Post reported that the Yankees, owned by the Steinbrenner family, "are nearing a deal" that would give 16% to private equity firm Apollo Sports Capital.

MLB allows private equity firms to own 15% stakes in its teams. However, Gasparino reports that MLB is "expected to waive the cap."

For those who might not remember, Apollo and the Yankees agreed to terms last month on a $2.6 billion financial deal. The rumors of a possible deal between the big-league club and the private equity firm first came about in July.

According to Sportico’s Scott Soshnick and Kurt Badenhausen, the Steinbrenner family is “selling at least 4%” of the Yankees' parent company to Apollo. However, Hal Steinbrenner will still be calling the shots as managing general partner, and the family still owns more than 60% of the team.

The Yankee Global Enterprises Board will also add a new member: Apollo Sports Capital CEO Al Tylis. As one can imagine, anytime a sports fan hears about private equity getting involved with their team, they want to know the impact. They see how private equity impacts everyday life, like stores or restaurants, and how the product could get worse.

Could the Yankees see an immediate impact with Apollo Sports Capital on board?

For the Yankees, it's unclear whether Apollo’s investment will help them open up payroll more in the offseason, as we’ve seen with the New York Mets and Los Angeles Dodgers. The Dodgers, for example, are among the 18 MLB teams with a private equity connection, per PitchBook.

Los Angeles is backed by a private equity firm, Arctos Partners. In 2022, Sportico’s Eben Novy-Williams reported that Arctos Partners created an MLB portfolio, owning stakes in six teams, including the Dodgers.

The good news for the Yankees is that they don’t have to compete with other MLB teams with Apollo, which has stakes in other sports such as soccer (Atlético FC, Wrexham FC) and a couple of tennis tournaments.

That said, Apollo will likely make money from this investment in the club. The Yankees are a known brand not only in the United States but globally. Which brings us back to the question: will the Yankees benefit from it?

Thus far, we can’t say that a team like the Dodgers has benefited from being backed by a PE firm, given the large contracts they’ve handed out over the last few years.

As things stand, the Yankees are ranked third in payroll this season ($298.2 million) behind the New York Mets and Dodgers, per Spotrac. And it wouldn’t be surprising if that still stands this offseason.

The Yankees are going to spend regardless in the offseason, but will they take to the level like the Dodgers have with this infusion of capital and ownership from Apollo? No one has that answer yet.

Other MLB teams with a private equity connection, not including Yankees

Team	PE-Backed or PE-Affiliated
Boston Red Sox	PE-Backed: RedBird Capital Partners and Arctos Partners
Chicago Cubs	PE-Backed: Arctos Partners
Miami Marlins	PE-Backed: MSD Partners
San Diego Padres	PE-Backed: Jose E. Feliciano and his wife, Kwanzaa Jones, and Arctos Partners
San Francisco Giants	PE-Backed: Sixth Street (10% stake), Arctos Partners and Westlake International Group
Houston Astros	PE-Backed: Arctos Partners
Los Angeles Dodgers	PE-Backed: Arctos Partners
Arizona Diamondbacks	PE-Affiliated
Baltimore Orioles	PE-Affiliated
Cincinnati Reds	PE-Affiliated
Cleveland Guardians	PE-Affiliated
Kansas City Royals	PE-Affiliated
Milwaukee Brewers	PE-Affiliated
Athletics	PE-Affiliated
Seattle Mariners	PE-Affiliated
St. Louis Cardinals	PE-Affiliated
Texas Rangers	PE-Affiliated

* info courtesy of PitchBook

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