One of the banks handling the Boston Celtics sale is probably the best-known on Wall Street: JPMorgan Chase. The other—BDT & MSD Partners—not so much. But while the general public likely hasn’t heard of the firm, what matters is that prospective buyers of the prized NBA franchise have. Formed at the start of 2023 by a merger, BDT & MSD Partners is led by two of the most well-regarded bankers who made their reputations at Goldman Sachs: Byron Trott and Gregg Lemkau.
Trott is usually described in financial media as Warren Buffett’s favorite banker. After all, not many people get name-checked in the Oracle of Omaha’s widely read shareholder letters—but Trott does.
“Byron has now been instrumental in three Berkshire acquisitions,” Buffett wrote in 2004. “He understands Berkshire far better than any investment banker with whom we have talked and—it hurts me to say this—earns his fee.”
Trott met Buffett during his 27-year career at Goldman Sachs, a time when he focused on sophisticated wealth-building deals for ultra-affluent clients. One deal was helping the candy bar billionaire Mars family buy out Wrigley in 2008 for $23 billion, with a helpful multibillion-dollar investment from Buffett.
Trott left Goldman in 2009 to form BDT, a Chicago-based wealth management investment bank and advisory firm. BDT doesn’t focus on allocating money to buckets of stocks and bonds like other wealth managers. Instead, it crafts bespoke deals in which wealthy clients make big, long-term bets: BDT helped Germany’s multibillionaire Reimann family buy up Dr. Pepper Snapple in 2018 to combine with their Keurig ownership, for instance.
Oftentimes, BDT works with existing corporate owners, keeping them in the investment syndicate for a buyout, or providing capital for an extended plan of growth. “We’re known to do deals in a very collaborative ownership way with owners of businesses and tailor-made capital designed to align interests and last for 10 to 15 years, rather than a shorter-term time period,” Trott explained on a 2020 University of Chicago virtual conference.
Lemkau more recently left Goldman, at the end of 2020, after being rumored to be in line to succeed chairman and CEO David Solomon. Lemkau was a banker at Goldman for 28 years, taking on high stakes deals, such as pulling together a plan for Elon Musk to be able to fulfill his contentious take-Tesla-private tweet of 2018 and getting Travis Kalanick to accept a $1.4 billion deal to walk away from Uber on behalf of client SoftBank that same year.
Like Buffett, Lemkau’s expertise earned billionaire praise. After the deal closed, Kalanick invited Lemkau for a drink, Lemkau said last year on the Capital Allocators podcast. The invitation was unexpected, since they had been on opposite sides of a contentious negotiation. At the bar, Kalanick told him, “‘Hey, for an investment banker, you’re okay. You probably even earned your fee here.’ That was about as high praise as you could get from anybody,” Lemkau said.
Lemkau said in the interview he hadn’t been looking to leave Goldman, but at some point client Michael Dell called up and asked him to evolve the family office that managed Dell’s fortune into an institutional investor that would open its strategies to other very wealthy investors. Dell convinced Lemkau with a text of 14 reasons to take the job—including the promise to be CEO on day one. The result was MSD Partners (most of Dell’s money remains in the separate family office, now named DFO.) The business looks to do control buyouts, large minority stake investments, real estate development and structure large credit packages for businesses. One MSD deal backed a new Kalanick startup.
More recently, Trott and Lemkau have been advisors on some of sports high-profile deals, counseling David Rubenstein on the purchase of MLB’s Orioles and serving as sellside advisor on recent minority stake sales of the NFL’s Dolphins and Eagles. Lemkau’s now the lead advisor on the Celtics sale.
Given the similarities in investing philosophies and timeframes, it made sense for the two businesses to merge in January 2023, forming BDT & MSD Partners. The combined firm manages $70 billion in assets, the vast majority of which are for outside investors, according to information filed with the Securities & Exchange Commission. Clients include high net worth individuals as well as foundations, endowments and insurance companies, according to general information disclosed to regulators. Owners of the business include Trott, Lemkau and Dell.
While BDT & MSD isn’t sports specific—it has a credit financing arm active in European soccer, but acts as a broker and investment advisor across any number of sectors—both principals have a sports background. Trott played baseball and football for the University of Chicago as an undergraduate before attending the business school there. A fellow ballplayer alumni suggested Trott would be a good fit with Goldman Sachs, leading to his career at the white shoe firm.
Lemkau played soccer at Dartmouth College. He planned to go pro in Zimbabwe—a teammate had earlier played in the country, Lemkau told the podcast—until his parents called him one day toward the end of his senior year and told him to get a real job. He pivoted to plan to go to law school, but then investment banking seemed more exciting. A year later, he started at Goldman Sachs.
Now, both men are brokering the sale of the Celtics—certainly a high-profile transaction their former employer would have wanted.
(This story has been updated with details of BDT & MSD’s history and holdings throughout.)
