LeBron James's Liverpool stake would soar if Bezos completes deal to become part owner of English soccer club

Amazon's founder Jeff Bezos is reportedly in talks to buy a minority stake in Liverpool FC.

Amazon.com founder Jeff Bezos is close to acquiring a one-third stake in English Premier League club Liverpool FC in a deal that would value the soccer team at approximately $5.9 billion (GBP4.4 billion), according to multiple media outlets including Sky News and soccer journalist Fabrizio Romano.

Bezos is reportedly in talks to acquire a minority stake in the club as part of a business consortium that also includes Facebook (META) co-founder Eduardo Saverin. The leader of the consortium is Amit Bhatia, the son-in-law of steel mogul Lakshmi Mittal and a former part owner in Queens Park Rangers, a second-tier English club.

Fenway Sports Group is the majority owner of Liverpool FC, and also owns MLB's Boston Red Sox and the NHL's Pittsburgh Penguins.

An FSG spokesperson confirmed that the investment group led by Bhatia approached the club about an investment last month.

The $5.9 billion valuation for Liverpool would make it one of the highest valuations ever made for an English soccer club. Todd Boehly purchased controlling interest in Chelsea at an approximately $5.3 billion valuation in 2022, and Ineos Chairman Sir Jim Ratcliffe purchased 27% of Manchester United $(MANU)$ (UK:0Z1Q) in 2023 at a $5.4 billion valuation.

Oftentimes in sports, minority stakeholders in franchises acquire a controlling share of the team in subsequent years.

"Minority stakes have become the preferred entry point, letting investors gain exposure to that growth story while incumbent owners retain control and crystallize value," Harsh Talikoti, a director at investment bank Houlihan Lokey's financial and valuation advisory business, told MarketWatch.

Here are the biggest winners from the proposed deal:

Fenway Sports Group

It should come as no surprise that FSG is a big winner here. That's because the group bought the team in 2010 for an estimated $480 million from American businessmen Tom Hicks and George Gillett.

Liverpool at the time was seen as a distressed asset, at least financially. Reports at the time indicated that the club could have gone into bankruptcy over its massive debt load.

FSG's investment in Liverpool is up approximately 1,300% based on team valuation since 2010. FSG will maintain control of the team, and will cash in on their investment if this deal is executed, reports say.

LeBron James

The newly signed Philadelphia 76ers star acquired a 2% minority stake in Liverpool back in 2011, shortly after FSG bought the club.

James "acquired" his 2% stake in the team rather than buying it because he was able to work out a deal with FSG where the basketball legend agreed to be added to FSG's official client list that they used to recruit new athletes. James also agreed to allow FSG to pitch him other business deals where they would earn a commission. In exchange, James and his business partner Maverick Carter were given a 2% stake in Liverpool, according to "LeBron, Inc.: The Making of a Billion-Dollar Athlete," a biography written by ESPN's Brian Windhorst.

James's stake in Liverpool was valued at around $6.5 million in 2011, and would be valued at $325 million if the deal with Bezos goes through, according to sports journalist Darren Rovell.

"Reported interest at this kind of valuation underlines how far premium sports franchises have moved from trophy assets to institutional-grade investments. Scarcity is the defining feature," Talikoti said.

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Amazon

The structure of the proposed deal between Bezos and the Bhatia consortium as Liverpool minority owners has made those in the sports industry wonder if Amazon (AMZN) could soon get involved in Premier League TV rights in the future.

Comcast $(CMCSA)$, through Peacock, USA Network and NBC, currently holds the Premier League's TV rights in the U.S. But Amazon has shown an interest in adding live sports to its streaming platform, recently inking deals with the NBA, NFL and New York Yankees. And because Bezos is reportedly not buying Liverpool outright and is instead part of a venture-capital portfolio, it may be a smoother regulatory path for Amazon, a company Bezos is executive chairman of, to bid on the rights.

The current U.S. television and streaming rights for the Premier League run through the 2027-'28 season.

-Weston Blasi