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KKR to Add Sports Franchise Exposure Through Arctos Acquisition
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Key Takeaways
KKR agreed to acquire Arctos in a $1.4B stock-and-cash deal, pending regulatory and sports league approvals.
KKR will pay $300M cash and $1.1B equity, plus earnout equity tied to share price and business performance.
Arctos adds $15B AUM and sports ownership expertise, boosting KKR's long-term growth and solutions strategy.
KKR & Co. Inc. (KKR - Free Report) announced a strategic agreement to acquire Arctos Partners for $1.4 billion. This will expand the company’s reach to sports franchises and support long-term growth.
Arctos, founded in 2019, manages approximately $15 billion of assets under management (AUM). The firm provides growth and liquidity solutions through Arctos Sports platform for professional sports franchises and Arctos Keystone platform, which provides GP solutions to alternative asset managers. It is the only firm approved for multi-team ownership across all five major U.S. professional sports leagues (NBA, NFL, MLB, NHL, MLS).
Joe Bae and Scott Nuttall, Co-CEO of KKR, said, “Arctos has created a distinctive and scaled platform across sports investing and capital solutions for asset managers, and the team has extensive experience in secondaries—three areas where we see significant long-term opportunity. The team has complementary strengths, strong cultural alignment, and an entrepreneurial approach that fits well with KKR. We look forward to working together to build a platform that expands opportunities across the entire KKR ecosystem.”
Financial Terms of the KKR-Arctos Transaction
Per this stock and cash deal, KKR will pay 1.4 billion in initial consideration, comprising $300 million in cash and $1.1 billion in KKR equity. Of the equity component, $900 million will be issued to existing Arctos shareholders, with the portion allocated to management subject to vesting through 2030. An additional $200 million of equity will be awarded by 2028 and vesting through 2033.
Further, Arctos stakeholders will be eligible to receive up to $550 million of incremental equity consideration related to KKR’s share price performance and business-specific performance goals, with vesting through 2031.
This transaction is subject to regulatory and specified sports league approvals, as well as customary closing conditions.
KKR-Arctos Transaction Benefits
The acquisition brings Arctos fully into the KKR platform and is expected to be accretive per share across major financial metrics immediately on closing. Additionally, perpetual and long-dated capital is projected to be 53% of KKR’s total AUM of $759 billion.
The acquisition will significantly strengthen KKR’s position in sports investing by adding a complementary business in large and high-growth markets with deep professional sports league relationships. Arctos also brings an experienced management team with deep expertise across sports investing and GP solutions, along with a strong operating platform. Together, these capabilities enhance KKR’s position in sports franchise investing and establish a solid foundation to build a scaled secondaries and solutions platform.
The acquisition is expected to expand KKR’s sourcing and origination reach across private equity, credit, real assets, insurance, and capital markets, while strengthening Arctos’ relationships with leagues, teams, GPs, and sponsors. It will also enhance the company’s wealth and institutional distribution, as sports and GP solutions are attractive to high-net-worth and mass-affluent investors. Thus, it will enable Arctos to grow its client base by leveraging KKR’s global network, distribution platform, and product development capabilities.
A key impact of the acquisition is the creation of a new investing business, KKR Solutions. This platform will combine sports investing, GP solutions, and a scaled secondaries strategy under one roof. KKR Solutions is projected to be a $100 billion or more AUM business for the company over time.
Our Take on the KKR-Arctos Deal
Overall, the acquisition is expected to enhance KKR’s sourcing, expand origination capabilities, and reinforce its long-term growth strategy. Arctos’ deep experience in secondaries and KKR’s global reach position the latter for sustained value creation across multiple investment cycles.
Over the past three months, KKR's shares have lost 18.3% compared with 3.7% decline of the industry.
Similar Step Taken by Another Financial Institution
Earlier this week, Webster Financial Corporation (WBS - Free Report) agreed to be acquired by Spanish banking giant Banco Santander S.A. (SAN - Free Report) in a cash-and-stock deal valued at about $12.3 billion. The transaction, expected to be closed by the second half of 2026, is subject to regulatory and shareholder approvals.
Per the agreement, Webster shareholders will receive $48.75 in cash and 2.0548 Santander American Depository Shares for each WBS share. The value of $75.59 per share was based on closing prices as of Feb. 2, 2026. The offer reflects a 16% premium to Webster’s 10-day volume-weighted average share price, a 9% premium to its all-time high closing price, and a valuation of more than two times Webster’s tangible book value per share as of the end of the fourth quarter of 2025.
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KKR to Add Sports Franchise Exposure Through Arctos Acquisition
Key Takeaways
KKR & Co. Inc. (KKR - Free Report) announced a strategic agreement to acquire Arctos Partners for $1.4 billion. This will expand the company’s reach to sports franchises and support long-term growth.
Arctos, founded in 2019, manages approximately $15 billion of assets under management (AUM). The firm provides growth and liquidity solutions through Arctos Sports platform for professional sports franchises and Arctos Keystone platform, which provides GP solutions to alternative asset managers. It is the only firm approved for multi-team ownership across all five major U.S. professional sports leagues (NBA, NFL, MLB, NHL, MLS).
Joe Bae and Scott Nuttall, Co-CEO of KKR, said, “Arctos has created a distinctive and scaled platform across sports investing and capital solutions for asset managers, and the team has extensive experience in secondaries—three areas where we see significant long-term opportunity. The team has complementary strengths, strong cultural alignment, and an entrepreneurial approach that fits well with KKR. We look forward to working together to build a platform that expands opportunities across the entire KKR ecosystem.”
Financial Terms of the KKR-Arctos Transaction
Per this stock and cash deal, KKR will pay 1.4 billion in initial consideration, comprising $300 million in cash and $1.1 billion in KKR equity. Of the equity component, $900 million will be issued to existing Arctos shareholders, with the portion allocated to management subject to vesting through 2030. An additional $200 million of equity will be awarded by 2028 and vesting through 2033.
Further, Arctos stakeholders will be eligible to receive up to $550 million of incremental equity consideration related to KKR’s share price performance and business-specific performance goals, with vesting through 2031.
This transaction is subject to regulatory and specified sports league approvals, as well as customary closing conditions.
KKR-Arctos Transaction Benefits
The acquisition brings Arctos fully into the KKR platform and is expected to be accretive per share across major financial metrics immediately on closing. Additionally, perpetual and long-dated capital is projected to be 53% of KKR’s total AUM of $759 billion.
The acquisition will significantly strengthen KKR’s position in sports investing by adding a complementary business in large and high-growth markets with deep professional sports league relationships. Arctos also brings an experienced management team with deep expertise across sports investing and GP solutions, along with a strong operating platform. Together, these capabilities enhance KKR’s position in sports franchise investing and establish a solid foundation to build a scaled secondaries and solutions platform.
The acquisition is expected to expand KKR’s sourcing and origination reach across private equity, credit, real assets, insurance, and capital markets, while strengthening Arctos’ relationships with leagues, teams, GPs, and sponsors. It will also enhance the company’s wealth and institutional distribution, as sports and GP solutions are attractive to high-net-worth and mass-affluent investors. Thus, it will enable Arctos to grow its client base by leveraging KKR’s global network, distribution platform, and product development capabilities.
A key impact of the acquisition is the creation of a new investing business, KKR Solutions. This platform will combine sports investing, GP solutions, and a scaled secondaries strategy under one roof. KKR Solutions is projected to be a $100 billion or more AUM business for the company over time.
Our Take on the KKR-Arctos Deal
Overall, the acquisition is expected to enhance KKR’s sourcing, expand origination capabilities, and reinforce its long-term growth strategy. Arctos’ deep experience in secondaries and KKR’s global reach position the latter for sustained value creation across multiple investment cycles.
Over the past three months, KKR's shares have lost 18.3% compared with 3.7% decline of the industry.
Image Source: Zacks Investment Research
At present, KKR & Co. carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Similar Step Taken by Another Financial Institution
Earlier this week, Webster Financial Corporation (WBS - Free Report) agreed to be acquired by Spanish banking giant Banco Santander S.A. (SAN - Free Report) in a cash-and-stock deal valued at about $12.3 billion. The transaction, expected to be closed by the second half of 2026, is subject to regulatory and shareholder approvals.
Per the agreement, Webster shareholders will receive $48.75 in cash and 2.0548 Santander American Depository Shares for each WBS share. The value of $75.59 per share was based on closing prices as of Feb. 2, 2026. The offer reflects a 16% premium to Webster’s 10-day volume-weighted average share price, a 9% premium to its all-time high closing price, and a valuation of more than two times Webster’s tangible book value per share as of the end of the fourth quarter of 2025.