Colony Capital ups stake in Paris Saint-Germain

Taking its ownership in the French football team to 62.5 percent is a sign of its long term ambition for the club, says the Los Angeles-based firm.

Colony Capital has enjoyed a ‘return’ already from its increased investment in Paris Saint-Germain as the French club rewarded it with its first home win of the season.

Paris Saint-Germain:
Returning investment

Sunday’s 3-0 victory over Lens in the French league came 48 hours after Los Angeles-based real estate investor Colony said it had increased its stake in the club from around one third to 62.5 percent.

Sebastien Bazin, chairman of Colony in Europe, said: “This change of ownership structure underscores our long term commitment to Paris Saint-Germain and our ambitions for the club. We intend to continue rebuilding so PSG is rapidly restored to its rightful rank.”

Colony purchased the additional 30 percent in struggling PSG from Butler Capital Partners, which is retaining 5 percent. Butler, a private equity firm, was part of the original trio of investors that bought the club in 2006. Colony and Morgan Stanley, which owns 33 percent, were the other original investors.

The parties have not divulged financial details of the transaction. However, it has been revealed that Butler did not intend to sell its holding so early.

In a statement, chairman of the buyout firm Walter Butler said: “Colony Capital indicated that it felt PSG needed one majority shareholder. Although this was not our original intention, we decided to simplify the situation at the club.”

Colony, run by Tom Barrack, has a reputation for its eclectic approach to investing and for agitating boards of major corporates to unlock value from real estate portfolios. In the case of hotel group Accor and supermarket chain Carrefour it has managed to get representatives onto the main board in order to gain influence.

Reuters reported Colony’s spokeswoman as saying the club would continue with its plans to find ways to boost revenue from its property assets.

“There’s a match at the Parc de Princes once a fortnight. They’re thinking of ways to use the facilities better and male local residents want to go there more often, instead of local residents regarding the place as a nuisance,” she is reported as saying.

Named for the royal hunting ground on which it was built, Parc des Princes the crown-like stadium was designed by architect Roger Tallibert and opened in 1972. The two previous stadiums on the site were more multi-purposed and, for years, served as the endpoint for the Tour de France.

The current stadium, which seats 46,480, was the battleground for France’s 2-0 victory over Spain in the 1984 European Championship Final. It was also the site of the 1993 loss to Bulgaria, which kept the national team from qualifying for the 1994 FIFA World Cup, which was held in the US.

Colony’s investment coincided with reports of renewed interest in Liverpool Football Club from Dubai International Capital, which lost out in its original approach to a bid from George Gillett and Tom Hicks, two US entrepreneurs.