Accessing the highly coveted sports sector is just one of several reasons KKR, the global alternative asset manager, may want to buy the much smaller Arctos Partners. If clinched, the sale of Arctos to KKR would provide further evidence that sports have come of age as a legitimate investment class.
Rising team valuations combined with recurring revenue of sports franchises, along with booming media rights, have spurred private equity firms to invest in the sector. RedBird Capital, Sixth Street Partners and Blue Owl are just some of the firms that own teams. In contrast, KKR’s sports holdings are surprisingly sparse. KKR owned FanDuel for several years but has exited. It has just two sports-related companies in its portfolio: PlayOn! Sports and Varsity Brands.
Meanwhile, Arctos is arguably the biggest name in sports investing and owns roughly 25 stakes in some of the most prominent professional sports franchises, including the Los Angeles Dodgers, Golden State Warriors, Buffalo Bills and soccer club Paris Saint-Germain. Arctos has also invested in sports tech companies such as SeatGeek, LeagueApps, GeoComply Solutions and Jackpot.com.
Sportico has confirmed reports that KKR has been in active talks to buy a majority stake in Arctos—and with it access to the 6-year-old firm’s coveted sports investments. Spokespeople for both companies declined comment.
“Everything Arctos has done since they were founded in 2019 is sports. The area has become hotter and hotter,” fundraising expert Kelly DePonte, founder of boutique consulting firm Kelly DePonte Advisory, said.
KKR and Arctos are two very different firms. Launched in 1976, KKR is considered one of the founding private equity firms that has gotten so big—it has $723 billion AUM as of Sept. 30—that it no longer calls itself a PE firm but prefers the moniker “alternative asset manager.” KKR currently invests in more than just PE, also focusing on credit, real estate and infrastructure. It has about 4,500 employees spread all over the world and many funds, including growth and buyout. KKR is currently targeting $20 billion for its latest flagship North America fund, and has raised over $14 billion, Buyouts reported in May 2025.
The much smaller Arctos has 78 employees and about $15 billion in AUM. Arctos is currently fundraising for its third flagship sports fund, Sportico reported. Its main business is investing in sports teams, but it’s branching out. In 2023, Arctos launched Keystone, a division that takes stakes in other alternative asset managers in private equity, credit, real estate and digital infrastructure. Keystone appears to have made one investment, backing Hayfin Capital Management in July 2024. KKR, by comparison, does invest in asset managers but doesn’t have a general partner, or GP, stakes business like Arctos.
Unlike buyout shops that typically acquire majority stakes in companies, Arctos focuses on minority holdings in sports franchises. Major U.S. sports leagues tightly regulate private equity investment, often capping how much equity teams can sell to funds overall, how much equity a single fund can own in one team and how many teams in which a single fund can invest.
“The leagues often prevent a lot of buyers, like PE, from buying control. There are lots of other rules that make a sale very difficult,” said Rob Morris, chairman and CEO of Olympus Partners, who had considered buying a stake in the Red Sox.
Even so, Arctos has been a prolific dealmaker and sold some of its holdings, including its stake in the Tampa Bay Lightning and a chunk of Hayfin Capital Management.
One of the biggest trends in private equity right now is firms launching products to attract retail or individual investors. Many of the largest firms, including Blackstone, Apollo Global Management and Carlyle Group, offer products tailored to wealthy investors and family offices that let them access private markets. Some are now offering “funds,” with flexible structures and lower investment thresholds, that let individuals invest in PE strategies. KKR has its K-Series products that are geared to accredited investors, but in 2025, the firm partnered with Capital Group to offer two funds for unaccredited, or everyday investors.
Arctos appears to be heading in this direction. CAIS Advisors has tapped Eldridge and Arctos to serve as independent managers on a new fund that gives wealthy individuals access to sports and media assets. The fund’s portfolio will include access to all five major North American sports leagues, including the NFL and NBA, as well as film and TV companies, music catalogs and live events, as well as other entertainment assets. The product right now only includes Arctos and Eldridge, but over time is expected to select additional managers. Eldridge, the asset management and insurance holding company owned by Eldridge Industries, could not be reached for comment. (Eldridge is an investor in Penske Media, the parent of Sportico.)
This means that Arctos itself may one day launch a sports fund for individual investors to access sports teams, which could be very attractive to KKR.
Still, several PE executives think the big motivation for KKR’s buy of Arctos is Ian Charles, a highly regarded secondaries executive. One investor in PE funds told Sportico that Charles was considered an innovator and firm builder in private equity and secondaries.
Charles spent nearly 14 years at Landmark Partners, a prominent secondaries firm. He left Landmark in 2019 to help launch Arctos. (In 2021, Landmark was sold to Ares, a large publicly traded alternative asset manager, in a deal valued at $1.1 billion.)
With mergers slow, secondaries transactions have surged in popularity as PE funds continue to have problems selling their portfolio companies. PE funds use secondaries—which refer to investors buying or selling existing stakes in a fund or its portfolio companies— to provide liquidity to their investors.
Arctos applies a secondaries strategy to sports investing, buying up existing minority stakes and providing liquidity to owners selling off parts of their teams. But “they are not the usual secondary player and don’t use the term secondary on their website,” DePonte said.
KKR does not have a dedicated secondaries unit. Adding Charles could address a big gap in its strategy. But DePonte isn’t convinced that gaining the executive is the main motivation for the Arctos buy. KKR could just acquire a secondaries firm if it was serious about expanding, DePonte said. (KKR has explored deals for other secondaries firms but got outbid, Bloomberg reported in January.)
The secondaries market has also changed in the past five years. If KKR was considering building a secondaries practice, they would “likely want someone with current experience, not someone with seven-year-old experience,” DePonte said.