Legends Hospitality is now majority-owned by investment firm Sixth Street, as a previously reported deal closed today. Sixth Street, a money manager with $50 billion in assets, owns 51% of Legends.
The deal values Legends, an organization affiliated with the New York Yankees and the Dallas Cowboys, at $1.35 billion, according to people familiar with the transaction. Legends co-founders each split slightly more than 40% of the remaining equity with another, undisclosed investor holding the rest, according to disclosures made to bond rating agencies as part of financing the transaction.
The existing management of Legends, which includes CEO Shervin Mirhashemi and COO Mike Tomon, will remain in place.
Legends started primarily as a concession and hospitality service in 2008, but over time expanded its offerings to include sponsorship valuations, naming rights sales, hospitality, ticketing, fundraising, e-commerce and merchandising. The business had more than 200 clients at the end of 2019, according to a bond rating agency. Legends has also assisted in $2.6 billion in naming rights, including for Las Vegas’ recently constructed NFL stadium.
It is believed Sixth Street is holdings its Legends investment in the company’s flagship TAO fund, in which it prefers investments where it is majority owner of a privately-held business. The firm likely sees Legends as capable of growing fast enough to produce at least a 13% internal rate of return each year—the average for the TAO fund over its lifetime—based on a presentation to a public pension fund last year.
A spokesperson for Legends declined to comment. Sixth Street didn’t immediately respond for a request for comment.