Disney is looking to sell a stake in ESPN, and in John Ourand’s eyes, private equity appears to be the direction CEO Bob Iger wants to go.
Ourand, in his sports media column for Sports Business Journal on Friday, wrote that selling a stake to a private equity firm amounted to a five-year loan from Disney that it would have an opportunity to buy back down the road if the company wanted to.
“Iger could find this move attractive because private equity does not represent a long-term play,” Ourand wrote. “Five years from now, when ESPN has diversified its business and is growing through streaming and gaming, Disney could buy back that stake.”
Ourand said companies like KKR, Apollo or Candle Media were brought up by the sources he talked to. Candle Media is run by former Disney executives Kevin Mayer and Tom Staggs.
“By going the private equity route, Iger would have cover to manage the business more aggressively and move more quickly into sports gaming and streaming,” Ourand wrote.
Ourand added that his sources were not big on companies like Fanatics and EA being players in ESPN, though Fanatics could be utilized as a suitable gaming partner. Sources didn’t see other gaming competitors like DraftKings, FanDuel, Flutter and MGM being willing to partner either.
Apple, Amazon, Google and Netflix were also thought to be vying for a share of some kind, but Ourand’s sources didn’t see Disney wanting to partner with companies that compete with Disney+ in the streaming space.
