Sportico – By Brendan Coffey, Dec 18, 2020
When Nassef Sawiris disclosed last week that he is the largest individual shareholder not named Dolan to own a part of the New York Knicks and Rangers, it raised a curious question: Why is an activist investor and Egyptian fertilizer billionaire taking equity in a company tightly controlled by Long Island’s Dolan family?
Sawiris disclosed in a mandatory regulatory filing that he owns 6.3 percent of MSG Sports, the holding company of the NBA and NHL franchises that trades under the MSGS ticker. His investment office, NNS Holdings, controls 982,098 shares today and will get another 247,386 in March through an agreement with an undisclosed counterparty, according to the filing.
The transaction is unusual because on the rare occasions Sawiris takes large positions in publicly traded companies, he’s agitating for change. It’s been five years since Sawiris had a stake in a U.S. company, according to Securities and Exchange Commission records. At that time, he got one investment, Martin Marietta Materials, to buy his other, Texas Instruments—a company he long called for to be sold. The transaction probably doubled his money. In 2015, he partnered with an activist fund to buy up shares in Germany’s Adidas, getting him in the door to address its board in fluent German and advocate for improvements. Shares have quintupled since. An Irish brewer, a Swiss cement maker and a Spanish engineering firm are other companies in which he’s taken activist stakes in recent years.
“In MSGS, he won’t be able to do that,” Jim Osman, founder and CEO of consulting group The Edge, a securities research firm specializing in special situation stocks, said in a phone interview. “Why? Because the dominant voting position of the Dolans is around 70%. The Dolans don’t really get pushed around.”