IHF in talks with Lagardère after ripping up €150m MP & Silva contract
By Jonathan Rest
The International Handball Federation, the sport's governing body, announced today that it has entered into negotiations with the Lagardère Sports agency about distributing its media rights from next year, after tearing up its contract with MP & Silva, which is engulfed in a financial crisis.
The IHF said its council had unanimously taken the decision to discuss a partnership with Lagardère for its senior events between 2019 and 2025, after ending the MP & Silva deal "due to financial difficulties on MP & Silva’s part."
If confirmed , the deal would cover exclusive global media rights distribution of three cycles of the biennial men's and women's World Championships, and include broadcast production of these events.
Lagardère would be expected to manage content creation, such as highlights and feature programming to help increase fan engagement and reach, and act as a strategic consultant to the IHF to assist in increasing its global presence over the next two Olympic cycles, all responsibilities MP & Silva had committed to.
Just last week, the DHB, the German handball federation, urged the IHF to take swift action in the wake of the financial crisis at MP & Silva and enable a domestic broadcast rights deal to be agreed for the 2019 men’s World Championships, which will be co-hosted by Germany and Denmark.
The IHF’s €150-million (now $171.5-million) media rights agreement with MP & Silva was due to kick in at the start of next year, but the agency is in a state of “paralysis” amid the blocking of payments by its shareholders, and various high-profile leagues have already terminated their deals with the company.
Andreas Michelmann, the DHB president, had told DPA, the German news agency, last week: “We have asked the IHF, the international federation, to find a solution quickly for the 2019 World Championships.”
Axel Balkausky, the sport co-ordinator at ARD, the German public broadcaster, added: “We would like to broadcast the handball World Championships. We had talks with the agency [MP & Silva] that were suddenly broken off the week before last.
“The situation is completely open. We don’t know who we must talk to now. It can be a complete mess.”
Lagardère had been an early contender for the IHF contract when the tender was released 11 months ago, but MP & Silva's offer of SFr173.9 million in rights fees, received in Euros (€150 million), and a SFr23.4-million spend on production, which was expected to be outsourced by MP & Silva, was signed off by the IHF in February.
Rival agency Infront had offered SFr158 million for the rights from 2019 to 2025, and cited a SFr18-million production cost.
Lagardère (and Infront) had actually submitted a bid for the 2019-21 and 2019-23 cycles, but the IHF preferred the longevity of the MP & Silva and Infront offers over three cycles, before making a final decision on which agency to select.
In rights fees alone, Lagardère was understood to have bid SFr73 million and just under SFr110 million for the 2019-21 and 2019-23 cycles, respectively, a year ago.
The loss of the IHF contract is another bitter blow for MP & Silva.
The Scottish Professional Football League and English Premier League soccer club Arsenal recently ripped up their broadcast agreements, following the Premier League's decision last month to terminate its three-year rights deal with the agency for media rights sales in the Asia-Pacific region, while Italy’s Serie A has taken legal action over unpaid fees and Spain’s LaLiga has taken back broadcast rights in Eastern Europe.
The agency is also in arbitration with Fifa over its contract to sell broadcast rights in Italy to the 2018 and 2022 World Cups, while agreements in other sports have also been affected, as the agency continues to suffer from a lack of financial support from owners Everbright, the Chinese investment company, and Baofeng Group, the Chinese technology company.
If all agreements between Lagardère and the IHF can be finalised, Lagardère will replace BeIN Media Group, the international pay-TV broadcaster, as the international federation's rights partner.
BeIN's contract (from 2014 to 2017) was worth a record SFr88 million in rights fees and SFr12 million in production costs, a marked increase on the estimated SFr60 million paid by the UFA Sports agency between 2010 and 2013.
BeIN employed the Pitch International agency to sell the IHF rights globally.