Providence Equity Partners will sell its remaining stake in US sports and entertainment channel YES Network to 21st Century Fox, which will increase its ownership position in the company from 49 percent to 80 percent.
The exit generates a 4.5x return multiple and 26 percent IRR for Providence, according to a source familiar with the transaction. Providence declined to comment on the transaction, which is expected to close before the end of the first quarter of 2014. The deal marks the third consecutive exit of 3x or more for Providence, which generated 3x returns from its sales of digital automotive marketplace company Auto Trader earlier this month and tradeshow company GLM in December.
Providence partially exited its investment in YES, which broadcasts sports-related programming to 15 million US subscribers, in late 2012. The deal valued the company at more than $3 billion. Providence created YES – The Yankees Entertainment and Sports Network – alongside a group of co-investors including Goldman Sachs, Major League Baseball franchise the New York Yankees and NJ Holdings, former owner of US professional basketball team the Nets, in 2002. The remaining 20 percent stake will continue to be held by Yankee Global Enterprises.
Providence closed its seventh fund on $5 billion in June. The firm revised its target from $6 billion to $5 billion and needed a fundraising period extension to get to its target, according to a person with knowledge of the firm.
Providence focuses on investing in media, communications, education and information companies and manages funds with $37 billion in commitments.