Serie A gives private equity firms to late-July to submit offers
The assembly of Italian soccer's top-tier Lega Serie A has given Paolo Dal Pino, the league's president, a unanimous mandate to continue negotiations with the various private equity firms assessing the league for investment potential, it has been reported.
Italian media claimed that the league has set the end of July as a deadline for all the firms interested in submitting concrete proposals and bids.
Over the last few months, investment firms including CVC Capital Partners, Bain Capital, and Advent International have been negotiating with Serie A over acquiring a stake in the league. These organisations are looking for an opportunity to get involved in the league’s media rights sales, which generate around $1.5 billion each season, 60 per cent of total revenue.
Serie A is considering creating a new company that would manage its broadcasting rights for 10 years from 2021, as well as the international trademark for the league, and its commercial development.
The league’s assembly plans to vote on a firm proposal for a new company to handle these rights by February next year, and that Dal Pino has been touted as the president for a Lega Media body, according to La Repubblica.
That newspaper has also reported the league is reluctant to cede more than 20 per cent of any company created to handle TV and commercial rights.
CVC’s bid, for 20 per cent of the new company, would cost the private equity firm €2.2 billion ($2.46 billion), but an exclusive negotiating window between that group and the league has now ended. Earlier this month, Bain made an offer of €3 billion to buy a 25-per-cent stake in Serie A.
CVC’s proposal also included providing financing for stadia across Italy, many of which have hardly been updated since the country hosted the 1990 Fifa World Cup.
The Infront Italy agency has a six-year, €5.94-billion minimum guarantee agreement with Serie A to act as its exclusive adviser on both domestic and international media rights, but that deal is set to expire next year.
Pay-TV operator Sky and over-the-top service DAZN hold domestic Serie A rights in a three-year deal worth €973 million per season (€780 million from Sky and €193 million from DAZN), running to the end of the 2020-21 campaign, while international agency IMG handles international media and other commercial rights in a deal worth more than €360 million per season.
The league has been exploring different funding options over the last few months, with the season having been suspended from early March to mid-June due to the coronavirus pandemic.
Blackstone, another private equity firm, was reported in early May to have been in discussions with the league around lending clubs money to help cover costs during the shutdown. Italian media reports at the time ascertained Blackstone’s potential contribution to be a loan of €100 million.