Warren Buffett buys $8 million stake in Atlanta Braves
According to an SEC filing, Warren Buffett's Berkshire Hathaway (BRK-A, BRK-B) has bought $8 million dollars worth of shares for the Atlanta Braves Major League Baseball Team (BATRA). Berkshire Hathaway has also exited positions in well-known companies after the third quarter, such as General Motors Co. (GM), Johnson & Johnson (JNJ), and Procter & Gamble (PG). Could this move open up opportunities for more public sports investing in the US?
Yahoo Finance's Josh Schafer, Alexandra Canal, and Pras Subramanian weigh in on Buffett's investments and how this could affect public sports investments going forward.
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Video Transcript
JOSH SCHAFER: I want to start with Warren Buffett taking a bet on the Atlanta Braves. Berkshire Hathaway buying in an $8 billion stake in that now publicly traded MLB baseball team. Guys, the biggest takeaway for me there was just professional sports getting the stamp of approval from one of the most famous investors, right? When Berkshire buys something and they get into a new industry, it normally just stirs up interest generally. And I think that was sort of the biggest initial reaction I had is, all right, Warren Buffett said it's cool to invest in sports.
ALEXANDRA CANAL: Yeah. Now, it's a very small stake when you think about all of the holdings in Berkshire Hathaway, when you think about all the money that Warren Buffett has. It's not entirely surprising though, because Buffett has been a long time investor in Liberty Media, which used to be the parent company of the Braves. So there's that relationship there as well.
It got me thinking though why we don't see more sports teams that are publicly traded. And I wonder if that's a trend that could continue. If the Oracle of Omaha is investing in sports, I'm sure a lot of other people would like to invest in sports. I love to invest in the Eagles or the Phillies or my favorite sports team. Only Philly teams, obviously. But that's something that I wonder if that could happen in the future.
PRAS SUBRAMANIAN: Yeah, in the States at least. It's much more common in Europe for football teams, "football," soccer teams to be public. But in the States we're about vanity ownership, rich people buying teams. And the Braves are an anomaly here with that public float.
Owned by Liberty, which is owned by John Malone. I'm not sure if Malone had an interest in the Braves before it was sold from Ted Turner. But all that being said, Buffett never passes on a good trade. He probably saw the numbers. You see the deals, see the skyrocketing values of sports teams and their media rights accompanying those teams. Atlanta is not the best market, but it's a big market. The Braves are a great team, great young talent.
ALEXANDRA CANAL: Won the World Series 2021.
PRAS SUBRAMANIAN: Right. Right. Right. So I wonder if-- I don't know if that really plays into Buffett saying, "Hey, they got a really good shortstop prospect in [INAUDIBLE] whatever." So I'm not sure what's going on there, but it's a great trade. He probably loved it. $8 million is like literally slivers of a penny to me, like it's like nothing.
JOSH SCHAFER: Yeah. It's like a fun sports gamble that we would do, right? When you think about the overall, it's like a little bat for Berkshire. But the Braves are an interesting team too when you think about what they're doing outside the stadium. They're one of those teams that's building restaurants, investing in real estate a little bit outside the stadium.
Sort of that modern sports play that we've been talking a lot about private equity getting involved in, right? So private equity has been increasingly interested in a lot of these sports teams than say the Dodgers or the Red Sox and a lot of other MLB teams. So it makes sense that you see big investors also sort of want to get in. Because as Pras said, those valuations--
PRAS SUBRAMANIAN: And a lot of Wall Street money with between Steve Cohen with the Mets and developing that area. I think the Eagles owner is a financial guy. Is it Lurie? I'm not sure if it's the guy--
ALEXANDRA CANAL: Jeff. Yeah.
PRAS SUBRAMANIAN: Big, big financial guy. And of course, the Red Sox. The [? Lerner, ?] right?
JOSH SCHAFER: Yeah.
ALEXANDRA CANAL: No, and sports are only going to continue to be an important element when you think about all the streaming players, the media players. We have the NBA rights renewal deal coming up. That's going to be a big driver in media as well.
