CHICAGO (Reuters) – Basketball legend David Robinson has conquered the sports landscape, collecting professional and college player of the year awards, two Olympic gold medals, two NBA titles and earning recognition as one of the greatest players ever.
Now the former San Antonio Spurs center is playing for gold of a different kind.
Robinson formed private equity firm Admiral Capital Group last year with a former Goldman Sachs executive, and this week they made their first investment, buying an undisclosed stake in food service company Centerplate.
Robinson, 43, and his partner, Daniel Bassichis, will look to invest in companies that offer a strong financial return as well as making a social impact.
“You have a tremendous opportunity to go out and make some money for your clients, but at the same time you also have a tremendous opportunity to impact those communities that you invest in,” Robinson said in a telephone interview.
“I always saw basketball as great opportunity to have some fun and make some money, but it’s also a place where you have a tremendous opportunity to impact communities,” he added. “I don’t see this business any different.”
A portion of all Admiral Capital profits will support philanthropic causes, including the development of the Carver Academy, an inner-city San Antonio elementary school to which Robinson has contributed more than $10 million.
Admiral Capital does not disclose financial targets, but private equity firms traditionally target annual returns of about 20 percent. Reaching that goal has been tough recently.
Admiral Capital — Admiral is Robinson’s nickname from his days with the U.S. Naval Academy’s college basketball team — was formed in February 2008, but it waited out the worst of the recession, said Bassichis, who turns 35 this week and has a background in real estate and lodging.
Centerplate has provided food service at the Super Bowl, the Belmont Stakes horse race and six presidential inaugural balls, and numerous sports teams are among its clients.
TAPPING MR. ROBINSON’S TIES
Robinson, who has joined Centerplate’s board, found a company he felt he could help grow by leveraging his sports and philanthropy relationships. Private equity firm Kohlberg & Co bought Centerplate in January for about $210 million.
While economists point to signs of recovery, it remains a tough time for private equity, which has struggled to put to work the $1 trillion of capital available for investing.
The pension funds and other investors in private equity funds have been hurting from sharp falls in their equity portfolios and are cautious about deploying more cash.
One reason for Centerplate’s attractiveness, Robinson said, was its partnership with Living Cities, a philanthropic group of 21 of the world’s largest foundations and financial institutions focused on improving the lives of low-income people and the urban areas in which they live.
Bassichis is quick to emphasize, however, that the firm’s top goal is maximizing returns and Robinson’s sports ties will help Centerplate grow in areas it is targeting, including NBA arenas and college campuses.
“We know about arenas, concessions,” said Robinson, due to be inducted into the Naismith Memorial Basketball Hall of Fame in September. “We know about colleges and have some influence in those areas.”
Centerplate agrees, seeing the deal with Robinson as a way to boost growth and give the company more of a local presence.
“We needed to differentiate the company from that sea of sameness in the market place,” Centerplate Chief Executive Desmond Hague said. “I really like the idea of tapping into David’s network.”
The Centerplate deal is the start of a broader relationship between Admiral Capital and Kohlberg, Robinson and Bassichis said. Robinson, who has a small stake in the Spurs, added with a laugh that buying an NBA team does not interest him.
(Additional reporting by Megan Davies in New York; Editing by Steve Orlofsky)