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  • Writer's pictureEthan Semendinger

Yankees x AC Milan

At the end of August, RedBird Capital Partners and the Yankee Global Enterprises entered into a strategic partnership to buy AC Milan.


RedBird Capital? Like the Cardinals?

While RedBird Capital Partners do have affiliations across the MLB, they are not related to, or own any part of, the St. Louis Cardinals. However, they do own a stake in the Fenway Sports Group. Yes. RedBird Capital owns a stake in the Boston Red Sox, Fenway Park, NESN, and- most importantly for this sale- Liverpool FC. (Apparently, the Fenway Sports Group also owns the Pittsburgh Penguins.) They also own a part of the YES Network, the XFL, the Wasserman Media Group, a hospitality service with the NFL, and Toulouse FC.

As a whole, they've heavily invested in sport from all aspects. In total, they manage over $6,000,000,000 in assets across 400+ members. Though, these are not all directly related to sport/sport management. They are also invested in energy, aviation, data, and more.

In a way it can be said that the New York Yankees and Boston Red Sox are joining together to buy a soccer team in Italy, though this is a misinformed understanding of how this works. The Boston Red Sox are owned by the Fenway Sports Group, which is owned primarily by John Henry (with about a 40% stake). Coming third in terms of shareholders in the Fenway Sports Group in RedBird Capital (who bought in with $750,000,000 of assets in 2021). So, they are a minority stakeholder in the group that owns Boston Red Sox.

It also discredits how the New York Yankees- through their own greater company the "Yankee Global Enterprises"- are involved. Again, it is less that the Yankees are buying an Italian soccer team, but moreso that Hal Steinbrenner, through YGE, has become a minority shareholder (with a reported 10% stake) in AC Milan.

This also isn't the Yankees/YGE first investment into other sports. YGE was originally started as "YankeesNets, LLC" back in 1999 as a joint-partnership between (obviously enough) the New York Yankees and then-New Jersey (now Brooklyn) Nets. It was set up to give the two teams more bargaining/negotiating power over Cablevision and other television providers as well as municipalities to get better TV deals and to build new stadium.


Side-Note: Interestingly enough, the foundation of "YankeesNets, LLC" came to life after there was a failed attempt to sell the Yankees in 1998 to Cablevision. Even more interestingly, along with the New York Yankees, the deal would've also included the selling of the New York Knicks and New York Rangers. However, it fell through when terms were unable to be agreed to that would've kept Geogre Steinbrenner as the sole decision maker for the Yankees. What a powerhouse group that would've been!


YankeesNets, LLC- after the fallout of the failed sell of the Yankees- also came to own the New Jersey Devils for a short period of time. However, the joint-partnership ended in 2004 in a multifaceted deal (that I will not explain in detail here) that ended in the divorcing of the three teams. This then had the Steinbrenner rebrand into Yankee Global Enterprises.

Outside of a short time owning the Nets and Devils (and an almost timeline owning the Rangers and Knicks), other sports related ventures have been the focus of YGE. As of right now, YGE has a minority stake in the YES Network, a minority stake in Legends Hospitality (in a joint partnership with the Dallas Cowboys), a minority stake in NYCFC (in a partnership with City Football Group- yet another parent company of a sports team, this one owning Manchester City), and now a minority stake of AC Milan.

To put it in a much simplified way:

A private investment company (RedBirds) that has a minority stake in the Boston Red Sox, Pittsburgh Penguins, and Liverpool FC (through the Fenway Sports Group) has joined with the parent company (YGE) of the New York Yankees and NYCFC, to purchase a football team (AC Milan) in Italy.


So, why is this important?


It Is & It Isn't:

To Hal Steinbrenner, the New York Yankees are strictly a business. To George Steinbrenner they were more than that. Now, to give Hal credit, he has been willing to spend. He's had a team salary of over $200,000,000 in all but 3 years (not counting 2020) since he took over the team in 2008 so he's been willing to put up good money. The problem is how that money has been spent, especially in recent years, which has not provided or gotten the best talent to the Bronx.

Hal Steinbrenner is also an owner during a period when baseball revenues are at an all-time high and while the MLB has placed penalties against teams that are willing to spend (in an effort to keep player salaries down). The easy thing to do is to say "phooey" to the fake salary tax and be willing to spend whatever it takes to win (just like the Los Angeles Dodgers do)- which is something I'd also greatly implore the Yankees to do- it is not something that they are going to do. Even while Hal Steinbrenner is making money hand over fist on this team.

So, while he's been willing to spend his money (poorly), he's also willing to do because he's been very flush with cash (and more every year) for over a decade now.

We wrote about this in 2018 (you can find the article, here) about how the Yankees are spending less and less on payroll when considering the percentage of how much money the team is making is going back to the club. Back then, the Yankees were worth $4,000,000,000. Today they are worth $5,000,000,000 according to Forbes, of which I believe is a conservative estimate. In less than 5 years they've seen at least a 25% increase in value. The Yankees- even when unable to make a World Series- are in a financial boom right now. Think of how much more they'd be making and how much more they'd be worth if they won!

However, all of this is ultimately unimportant to the bigger picture of purchasing a 10% stake in AC Milan. The Italian soccer club sold for $1,200,000,000. The Yankees, through Hal Steinbrenner and other partners Yankee Global Enterprises, spent a combined $120,000,000 for that 10% stake.

Ultimately, that is chump change for Hal Steinbrenner, but it helps allow him to diversify his portfolio (and the other interests within YGE) in the greater sporting world. If anything, this is a promising move to see Hal invest better around the world to make more money in the long-term, which you'd hope he'd then go around and invest back into the Yankees.

He's been willing to invest, carefully, over the past 15 years. Maybe if this AC Milan sale goes well and the team starts to profit big he'll be willing to put more down to invest. However, this will ultimately prove to be nothing on either end. Hal gets to diversify his portfolio and brag about being an owner of another sports team with the money he's making from the Yankees.

Congrats to Hal Steinbrenner on getting involved in a solid deal for what may be the #1 soccer franchise in Italy. But, the effect this will have on the Yankees is minimal at worst and nonexistent at best.

1 Comment

Sep 09, 2022

Maybe Hal could toss his couch cushions and find a few more Ducats for Judge?

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