How The Celtics Buyer Got Rich

Forbes: How the Celtics Buyer Got Rich

Key Concepts:

• Private Equity
• Enterprise Software
• Value Investing (Buying, Improving, Selling)
• Assets Under Management (AUM)
• NBA Ownership Rules
• Two-Stage Acquisition

1. The Celtics Acquisition:

• William "Bill" Chisum is leading an investor group to buy the Boston Celtics for $6.1 billion, the biggest Pro Sports deal in history.
• The sellers are the grck family, who bought the Celtics for $360 million in 2002.
• Forbes valued the Celtics at $6 billion in October, making Irvin grck and the family billionaires worth $2.2 billion.

2. Chisum's Background and Strategy:

• Chisum made his fortune through decades of private equity deal-making, focusing on enterprise software companies.
• His strategy involved buying, improving operations, and selling these companies for significant profits.
• He graduated from Dartmouth and Wharton School.

3. Symphony Technology Group (STG) and Romesh Wadwani:

• In 2002, Chisum joined Symphony Technology Group (STG) as a senior investment partner, recruited by Silicon Valley billionaire Romesh wadwani.
• Wadwani funded STG with money from the $9.3 billion sale of his software firm, Aspect Development, to I2 Technologies in 2000.
• Over 15 years, Symphony invested $1.6 billion and returned $10 billion to investors.
• Symphony focused on middle-market software companies, improved their operations, avoided excessive debt, and sold them for multiples of their purchase price.
• Symphony started four companies and purchased 21 others.

4. Key Deal: Information Resources (IRI/Sarana):

• Symphony acquired market research firm Information Resources (later named IRI and now Sarana) for less than $120 million in 2003.
• They sold most of it at a $1 billion valuation in 2011.

5. Transition to STG Partners:

• In 2017, wadwani retired as CEO of Symphony Technology Group to launch an AI investing firm.
• Chisum took over as CEO and rebranded Symphony as STG Partners.
• STG Partners now has $11.7 billion in assets under management (AUM).

6. Chisum's Net Worth and Ownership:

• Chisum, 56, is the principal owner of STG Partners, holding more than 50% of the firm.
• Forbes estimates Chisum's net worth at over $3 billion, revised upwards from an earlier estimate of at least $1 billion.
• The upward revision is based on additional information leading to a higher estimated value of STG Partners, of which Chisum owns an estimated 60% stake.
• Peter shill Partners, a subsidiary of Goldman Sachs, invested $60 million into STG Partners in 2021 for a minority stake.
• Chisum owns at least four homes and apartments in California and New York City, worth an estimated $30 million, plus a home on nuet.

7. NBA Ownership Requirements and Deal Structure:

• The NBA requires the principal owner of a team to own at least 15% of it.
• Chisum will likely need to invest at least $915 million for his stake.
• The purchase is a two-stage process.
• Irving grb son Wick grousbeck will remain as CEO and governor of the Celtics through the 2027-2028 season, when the second part of the Celtics sale will close.

8. Quotes and Statements:

• grck stated that Chisum's "love for the team and the City of Boston, along with his chemistry with the rest of the Celtics leadership, make him a Natural Choice to be the next governor and controlling owner of the team."
• grck added, "I know he appreciates the importance of the Celtics and burns with a passion to win on the court while being totally Comm to the community."
• Chisum told ESPN that he attended his first Celtics game on his sth birthday, adding, "I've been a rabid fan ever since I bleed green I love the Celtics."

9. Conclusion:

Bill Chisum's acquisition of the Boston Celtics is the culmination of a successful career in private equity, built on a strategy of acquiring and improving enterprise software companies. His partnership with Romesh wadwani at Symphony Technology Group was instrumental in his rise, and his leadership at STG Partners has solidified his position as a major player in the investment world. His passion for the Celtics and commitment to the community make him a fitting successor to the grck family.