Velocity Capital Management has acquired Parella Motorsports Holdings (PMH), a provider of live motorsports racing events.
PMH owns five major road racing series and hosts racing festivals across the United States under its SpeedTour brand. PMH was founded in 2012 by CEO Tony Parella and is headquartered in Plano, Texas.
PMH’s five series include the Trans Am Series presented by Pirelli, the longest-running road racing series in the US; the Sportscar Vintage Racing Association (SVRA), the largest vintage racing organization globally; Formula Regional Americas (FR Americas) and Formula 4 United States Championship (F4 US), the first two professional levels of the Formula 1 ladder; and the Prototype Sprint Series Association which hosts prototype race cars in a sprint race format at road courses in America.
During the 2023 season, PMH’s race events had more than 5,500 entrants at such iconic racetracks as Indianapolis Speedway, Circuit of the Americas, Laguna Seca, Watkins Glen, Road Atlanta, and Lime Rock. PMH’s SpeedTour events include car shows and concerts that are live streamed on SpeedTour TV’s YouTube page.
“We welcome Tony and the entire Parella team to our family,” said David Abrams, a co-founder and managing partner of Velocity. “Tony will remain as CEO and he has built a tenured and experienced senior leadership team that is aligned to create long-term shareholder value. We have assembled an incredible group that will work with management and Velocity to execute our growth initiatives.
“After achieving accelerated growth over the past 12 years, I have been seeking the right partner to help me realize my vision for Parella Motorsports and I am thrilled to be collaborating with the Velocity team,” said Mr. Parella. “Their hands-on, value-add approach and domain expertise within the sports and entertainment sectors are exactly what our company needed to grow both organically and through acquisitions, which will help ensure we achieve our true potential. I am excited to lead us through this next chapter in our growing motorsports operation.”
Velocity Capital is a control and non-control investor in the sports, media, entertainment, and technology sectors. Areas of specific interest include content and intellectual property; sports, gaming and e-sports; sports betting; and fitness and wellness. The New York City-headquartered firm was founded in 2022 by veteran sports investors David Abrams and Arne Rees. The buy of PMH is the fifth investment made by the firm’s Velocity Opportunity Fund.
“The Parella investment is a perfect complement to our existing portfolio as we have already begun cross-pollinating the company with our portfolio companies and leveraging our own direct operating experience to further commercialize the business and improve the monetization of the company’s intellectual property,” said Mr. Rees. “We believe that two of our portfolio companies specifically, Elevate, a best-in-class sports and entertainment consulting firm and Videocites, the leader in sponsorship valuation and fan engagement tracking across social media, will greatly accelerate the company’s growth trajectory. Additionally, Delaware North, a leading global hospitality and entertainment company and one of Velocity’s strategic partners, is also actively engaged in a range of revenue maximization initiatives.”
Co-investing in this transaction were Cohesive Capital and Bolt Ventures, the family office of sports investor David Blitzer. In addition, Jeffrey Wolf, a former media executive at Scripps Networks and Sony Pictures Television, and Andy Lustgarten, a former CEO of Madison Square Garden, will join PMH’s board of directors.
Cohesive Capital makes private equity co-investments alongside private equity sponsors. The firm is primarily focused on the small and middle market but will consider investments in companies of all sizes and across a wide array of industries. New York City-headquartered Cohesive, led by Managing Partner John Barber, was founded in 2010 and is currently investing through its fourth fund, Cohesive Capital Partners IV LP, which closed in 2023 with $400 million in capital.
© 2023 Private Equity Professional | December 8, 2023
