Advent International is among the private equity firms interested in acquiring a stake in a commercial arm set to be created by the LFP, the French professional soccer league, it has been reported.
It was reported last week that the LFP is seeking to launch a new commercial subsidiary and sell a maximum 20 per cent stake for around €1.5 billion ($1.8 billion) in an effort to support domestic clubs struggling financially from the Covid-19 pandemic.
The league is hoping to receive interest by early November and it is believed that Advent is an early suitor and is prepared to enter into talks, according to Bloomberg.
Ligue 1 has become a significantly more attractive property in recent months following the move of Argentinian superstar Lionel Messi to Paris Saint-Germain, which saw him team up with fellow global stars Neymar and Kylian Mbappe.
LFP president Vincent Labrune, accompanied by representatives of two investment banks (Lazard and Centerview) and a law firm (Darrois), presented the project to the clubs at an assembly last week.
A document was drawn up by the two banks and distributed to private equity firms that have strong ties to the sports industry. The LFP is hoping to enter into formal negotiations by January once potential suitors have expressed their interest.
The LFP has been permitted to enter into discussions with Advent and other private equity groups after France’s National Assembly voted to allow professional sports leagues to create commercial entities and sell stakes to external investors in March.
However, the league will be required to control at least 80 per cent of voting and economic rights in the commercial entity.
The plan will ultimately need a majority approval from the French clubs but has already received a boost with Ligue 1 giants Paris Saint-Germain reportedly in favour of it.
Collectively, French clubs lost around €730 million in the 2020-21 season due to the pandemic.
This was largely due to the absence of fans in stadiums, as well as the collapsed media rights deal with Spanish production company Mediapro.
If ratified, an agreement would replicate the recent long-term deal struck between Spain’s LaLiga and CVC Capital Partners that marked a first in European soccer.
Notably, US-based Advent was on the verge of securing a stake in a commercial arm of Italy’s Serie A as part of a consortium that included CVC and Italian state-backed fund FSI late last year.
The deal ultimately fell apart as multiple clubs performed a u-turn and opposed the proposal after all 20 top-flight teams initially voted unanimously in favour of it, although reports emerged last month that negotiations have been revived.