Craig Hutchison’s Sports Entertainment cashes in on sports teams

Craig Hutchison’s Sports Entertainment Group is selling off stakes in its sporting business, which includes basketball’s Perth Wildcats and new Melbourne Mavericks netball team, to reduce its $28.7 million debt before looming repayment deadlines.

Corporate filings that were published late on Wednesday reveal the sports media business has raised $1.5 million in exchange for a minority share in its sports teams division, with the funds put directly towards repaying its financier, Commonwealth Bank.

Craig Hutchison at Sports Entertainment’s annual general meeting in November.Credit: Joe Armao

The company said it was looking to raise further funds through the sale of shares in its sporting teams business.

“SEG is seeking to raise further funds for a share in its sports teams business, unlocking the strategic value created through its ownership of four professional basketball teams and one professional netball team,” the filing said.

Separate filings show the private sale of 4200 shares in exchange for $1.4 million, valuing the sporting assets business, SEN Teams, at $40 million.

The market capitalisation of the ASX-listed parent company, Sports Entertainment Group, sits at $54.8 million as of Thursday, according to Bloomberg.

SEN Teams houses the company’s five sporting teams: the new SSN team Mavericks, the Wildcats in the NBL, WNBL team Bendigo Spirit and NZNBL teams Otago Nuggets and Southern Hoiho.

West Australian William Bloking, a former prominent mining executive, bought a 1 per cent controlling stake for $400,000, while New York-based SEN sports analyst David Alcaro purchased a 2.5 per cent stake for $1 million.

Neither Hutchison nor Sports Entertainment Group responded to a request for comment.

Hutchison, a journalist and media executive, is the ASX-listed company’s second-largest shareholder, as well as its CEO, managing director and leading on-air talent.

SEG’s sporting assets include the NBL’s Perth Wildcats. Credit: Getty Images

Alongside the company’s sporting assets, it also owns digital and radio assets (Sports Entertainment Network) and a television production company.

Hutchison and company chair Craig Coleman told shareholders in late November that deals were in the works to bring down SEG’s debt facility.

On the same day, the company announced the sale of its New Zealand digital and audio business to TAB NZ for $3.7 million. SEG retained ownership of the two basketball teams based in New Zealand.

SEG has faced heightened pressure after reporting a $9.3 million loss in FY23, with its deadline for the $28.7 million approaching in August.

The company’s auditors issued a warning in November over SEG’s ability to survive should it not find a cash injection. A director’s note in its annual report, released in late October, said the business’s status as a going concern was a “material uncertainty” after it breached bank covenants relating to its loan.

The new filings show SEG has $6.3 million available for future operating activities, with the company still in negotiations over an extension of its repayment terms. It also reported a net operating cash inflow of $2.6 million in the quarter ending December 31.

SEG bought the eighth Super Netball licence in 2023, meaning the newly created Mavericks will compete in the 2024 competition. The licence went to market after AFL giant Collingwood, the nation’s largest sports club, announced it would withdraw its team from the Super Netball competition at the end of the 2023 season after being deemed unsustainable.

Nine Entertainment, the owner of this masthead, owns a 3 per cent stake in SEG via 3AW.

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