CMC, Sequoia launch sport fund, back China kickboxing business
CMC Holdings – a unit of media-focused GP CMC Capital Partners – and Sequoia Capital China have formed a sports investment fund and led a Series A round of funding for Wanmingyang Media, which organizes and video streams kickboxing events in China.
The fund will target global sports assets, leveraging the huge appetite for media properties – ranging from sport to movies – among Chinese investors. This is in turn a function of growing consumer demand in China, where sport in particular is relatively underpenetrated. The sector accounts for 0.6% of national GDP, compared to a global average of 2.1%.
Wanmingyang Media has received more than RMB100 million ($14.5 million) from the new fund. The company, which was established in April of last year, launched the “Warrior’s Glory” professional kickboxing league and has secured strategic partnerships with local broadcasters Beijing Media Network and Shenzhen Media Group.
The capital will go towards opening new clubs, financing a youth training system and exploring the development of amateur kickboxing. Wanmingyang Media also plans to improve the digital platform through which fans can watch fights, with the introduction of live payments, overseas copyright distribution and other initiatives intended to deliver profitability.
Last year, Yao Capital – a sport-focused PE firm co-founded by former Chinese basketball star Yao Ming – and cable TV giant Liberty Global led a Series B round of funding for Glory Sports International (GSI), which is regarded by many as the world’s leading kickboxing organization. The deal included a joint venture that will promote the sport in China, with additional capital provided by Yao Capital and GSI.
CMC and Sequoia are not the first GPs to launch a sport industry-focused fund in China: last year FountainVest Partners and outdoor advertising business Focus Media created a $400 million vehicle. However, CMC is a seasoned investor in sport-related assets, through both its private equity funds – the firm is currently raising $600 million for its second US dollar-denominated vehicle – and CMC Holdings. The latter is an investment platform designed to hold assets beyond a 10-year horizon.
CMC’s sport-related interests include City Football Group, which owns the English Premier League club Manchester City and other related businesses; Beijing-based sports marketing business SECA; Tiao Power, which holds the broadcasting rights to China’s domestic football league; sports data provider Cubee; sportswear manufacturer Meike Holdings; and the promoter of the electric car racing series FIA Formula E Championship.
CMC was set up by Ruigang Li, formerly president of Shanghai Media Group (SMG).
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