UPDATE 4-Yankees, Cowboys, Goldman form sports services co.

(Adds details of deal structure, other background)

By Ben Klayman

CHICAGO, Oct 20 (Reuters) - Two of the most recognized U.S. sports teams -- the New York Yankees and the Dallas Cowboys -- have formed a stadium operations company with Goldman Sachs Group Inc (GS.N) and a Texas private equity firm.

Goldman, CIC Partners LP in Dallas and the two teams said on Monday that Legends Hospitality Management LLC would offer a broad range of sports business services. It will focus initially on catering, concessions, retail merchandising and other services for major sports and entertainment facilities.

The teams will each own a third of the venture, with Goldman owning most of the rest, according to a source familiar with the plans who asked not to be identified. Legends raised $100 million about two weeks ago in a debt sale managed by Goldman, the source said.

Legends' creation was not a surprise, given how much Major League Baseball's Yankees and the National Football League's Cowboys have riding on drawing fans to their new stadiums even as they raise ticket prices in the increasingly weak U.S. economy, said Robert Boland, professor of sports management at New York University.

"Clearly, the economy is telling us this is getting harder and harder for teams to sell these tickets, and it's important they come forward with a reason to show fans that these are more than just tickets, that there's something else attached," he said.

"The one problem that every pro team is facing right now is they're charging more than their fans can afford," he added.

Major League Baseball reported a decline of almost 1 percent in per-game attendance during the regular season, and the commissioners in baseball and the NFL have warned about the economy's impact on fan spending.

Officials for both the Yankees and Cowboys seemed to recognize that dynamic in forming Legends.

"The old model of stadium concessions is broken," Yankees Co-Chairman Hal Steinbrenner said in a statement. "Fans want and deserve a better experience for their sports entertainment dollar."

Based in Newark, New Jersey, Legends will be led by Michael Rawlings, former president of Pizza Hut Inc, a unit of Yum Brands Inc (YUM.N).

Legends will expand beyond its founding teams to offer services to other pro and college teams and event venues worldwide, the companies said. It also will broaden its capabilities through a combination of acquisitions, strategic partnerships and continued internal growth.

"Legends was founded on the principle that enhancing the stadium experience will result in a more satisfied fan base," Cowboys owner Jerry Jones said. "Satisfied fans attend more games and show greater loyalty."

Legends has been granted exclusive rights on a multiyear basis to operate concessions, catering and merchandising services at the Yankees' and Cowboys' new stadiums, both of which will open next year at a cost of more than $1 billion each.

Goldman Sachs and CIC Partners also provided financing for and serve as financial advisers to Legends.