Cannae's Sports Bet: Soccer, Cash, and a Shrinking Discount
The holding company sells non-core assets, buys a rugby club, and trims hold-co costs as it doubles down on football investments.
CNNE · Earnings Call · 2026-08-10
The Football Empire Takes Shape
Cannae's transformation into a sports and entertainment vehicle is no longer aspirational. This quarter, management added Exeter Rugby to the portfolio, alongside Black Knight Football's AFC Bournemouth, FC Lorient, and Moreirense. As CEO Ryan Caswell put it: “With Exeter, we acquired a team in one of the world's leading sports with a strong brand, proven fan base, and history of success.” — Ryan Caswell, Chief Executive Officer · 2026-08-10 The investment is small, but it signals a playbook: acquire clubs at attractive valuations, apply commercial synergies, and boost broadcast and sponsorship revenue. Bournemouth's sixth-place finish — its best ever — and Europa League qualification are proof that the strategy works. The club sold players for more than $350 million in recent transfer windows, and the stadium expansion is on track. Black Knight Football remains the centerpiece, and the new Exeter addition fits neatly into that multi-club model.Letting Go of the Non-Core
To fund the sports push, Cannae has been aggressive in selling off legacy assets. The $90 million sale of The Watkins Company and the swap of Brasada Ranch to Chairman Bill Foley in exchange for eliminating his put right both closed this quarter. These transactions, as Ryan explained, “demonstrate the importance... of monetizing non-core assets to generate capital for share buybacks and new investments.” — Ryan Caswell, Chief Executive Officer · 2026-08-10 The non-core asset monetization program is clearly working, and it freed up roughly $137 million in cash and eliminated a $20 million liability. The restaurant group remains the last major piece to exit. A $45 million non-cash impairment charge was taken, and the strategic review is taking longer than hoped. Management still sees a path forward, but investors should expect more noise from this segment until a sale is completed.Leaner, Richer, and Ready to Buy Back
Hold-co expenses fell 85% year-over-year to under $9 million, a dramatic improvement from the $59 million baseline. That discipline is central to management's promise to close the discount to NAV. While no buybacks occurred in Q2, the company has $124 million in cash today, plus a $45 million federal tax refund expected in 2026. Ryan reaffirmed the intention to resume buybacks in the back half of the year: “we remain committed to share buybacks and expect to pursue buybacks in the second half of the year.” — Ryan Caswell, Chief Executive Officer · 2026-08-10 The holding company also now marks its SpaceX stake to market, recording an $83.4 million gain in Q2. As CFO Brett Correia noted, “With the SpaceX IPO in June, we began marking our investment to market, resulting in a gain of $83.4 million.” — Brett Correia, Interim Chief Financial Officer · 2026-08-10 With the IPO behind it, SpaceX becomes a more dynamic asset — and one that could be sold into liquidity events as the lockup expires. A strong balance sheet supports the plan. Effective net cash rose to $65 million, up 246% year-over-year, and liabilities-to-assets stood at 25.6%. This gives Cannae ample firepower for both investments and buybacks.The question is whether this pivot can generate enough returns to lift the shares. The prior call's commentary already hinted at the direction: “We are pushing to sports and entertainment-related assets, but with that being said, we like all of the investments that we have.” — Ryan Caswell, Chief Executive Officer · 2026-05-11 And on SpaceX, management had said “it seems like it will be a source of cash for us over time” — Ryan Caswell, Chief Executive Officer · 2026-02-24 — a promise that now has a timetable.We will continue executing on all aspects of this strategy, which we believe will grow our stock price and close the discount to NAV.