JAT Buys MSG, Sparking Rumors Of Knicks Sale Push

Aug 26 2014 | 8:39am ET

JAT Capital Management has picked a high-profile arena for its first activist play: Madison Square Garden.

The hedge fund, which has never before filed an activist position, filed its first on Friday night, announcing a 6.7% stake in MSG, which owns the famed New York City arena as well as the teams that play in it. The purchase makes JAT one of MSG’s top three shareholders.

The hedge fund said it would seek “constructive” talks with MSG’s owners, the Dolan family, in an effort to improve “long-term value.”

JAT did not say what it hoped MSG would do to achieve that, but its move has some believing that it would push for a sale of the National Basketball Association’s New York Knicks.

The recent sale of the Los Angeles Clippers—that city’s second most popular hoops team—for $2 billion has some suggesting that the Knicks could be worth $3 billion. MSG’s total market capitalization is about $5 billion, and the company owns not only the building and the Knicks, but hockey’s New York Rangers, the WNBA’s New York Liberty and the MSG television networks.

The Dolans have shown no interest in selling their flagship property. And it isn’t clear that a campaign to force them to could succeed: MSG has a dual-share class structure, giving the Dolans control of 69% of the voting power.


In Depth

Q&A: Fund Administration Comes To The Cloud

Jul 14 2017 | 7:23pm ET

The fund administration sector has been steadily implementing new technology, such...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Rastegar: PE Real Estate Gains Momentum as Uncertainty Rises

Jul 21 2017 | 6:04pm ET

The steady march of equity markets and fundamental shift in the direction of Fed...

 

From the current issue of