Spanish giants Barcelona have confirmed the resale of a 29.5% stake in Barca Studios, the club’s media and production arm, to Libero Football Finance, the German-based firm that advises soccer clubs seeking to obtain finances, and Dutch investment firm Nipa Capital to raise €120 million ($132 million).
The new deal sees part of the 49% stake (24.5% each) previously sold to fan token and engagement platform Scoios.com and web development agency Orpheus Media in July and August last year resold to the two new investors so the club can meet domestic club competition LaLiga’s strict budget rules ahead of the new season.
Under the deal, Socios.com and Orpheus have ceded 29.5% (14.75% each) of their stake in Barca Studios so the club can resell it to Libero Football Finance and Nipa Capital. Socios.com and Orpheus will retain a reduced stake in Barca Vision of around 17% each.
LaLiga’s salary cap measures a club’s financial state based on the previous season’s budget sheet and if it has enough funds to cover the summer transfer budget and proposed wage bill for the upcoming campaign.
The original deals with Socios.com and Orpheus Media raised €200 million, initially allowing the club to balance its books and buy new players ahead of the 2022-23 campaign.
However, while Socios and Orpheus Media initially handed over €10 million each to the club, both companies last month agreed with Barcelona to delay their scheduled €30 million payments, leaving the club with a €60 million gap in their books ahead of the 2023-24 season, which started on Friday (August 11).
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The delayed payment has complicated the club’s navigation of LaLiga’s strict budget rules, with Barcelona looking to register new contracts by first-team players Gavi, Ronald Araujo, Inaki Pena, Marcos Alonso, and Sergi Roberto, plus their three new signings in Ilkay Gundogan, Inigo Martinez, and Oriol Romeu.
The new deal will allow Barcelona to immediately incorporate the €120 million into their books, solving their salary limit issues.
The news of Barcelona pulling its last ‘economic lever’ was first reported last month.
The economic levers, a term coined by club president Joan Laporta last year, refers to the club offloading two portions (a 25% stake in total) of future LaLiga media rights to US investment firm Sixth Street in June and July last year, for a total of €667 million.
Along with the stakes sold to Socios.com and Orpheus Media, through a new sponsorship deal with audio giant Spotify, the departure of players, and increased revenue, Laporta said the club had brought in €868 million.
These piece-by-piece asset sales by Barcelona represent an effort to get the club’s finances to a point where they can gain the approval of their auditors – who have been investigating the club’s accounts on behalf of LaLiga – to sign new players.
LaLiga’s financial regulations mean clubs attempting to sign players without meeting the threshold will have their registrations blocked. Therefore, the Catalonian giants have had no choice but to find buyers for some of their assets – such as media rights.
Meanwhile, Barcelona have announced a plan to spin off their newly created Barca Media arm into a publicly traded business worth as much as $1 billion.
The club and special purpose acquisition company (SPAC) Mountain & Co., the Swiss venture capital firm, announced they reached an agreement to bring Barca Media public on the Nasdaq Stock Market.
Barca Media was created by merging the club’s in-house production operation Barca Vision, previously known as Barca Studios, with its audiovisual content units under Barca Media. It now houses all the media content generated by the club in the past 20 years, as well as its esports arms and business division focused on NFTs, web3, and other tech monetization projects.
In a statement, Laporta said: “The differentiated content that we have already produced has proven extremely valuable, resonating well and driving meaningful engagement with our growing global fanbase while generating new revenue streams.
“This step is a strategic decision that will give us additional resources to continue to grow the platform at a time when the demand for sports-themed digital content is expanding exponentially.”
The deal values Barca Media at between $900 million to $1 billion, based on projections of how many Mountain SPAC shareholders retain shares in Barca Media. Common shareholders are expected to own about 12% of Barca Media, while SPAC sponsors another 5%. The rest will be owned by Barcelona through a holding company, giving the club control of the business after it is floated.
During a presentation to shareholders filed with regulators, Barca Media said it will leverage its large global social media base of 421 million followers across the major platforms to promote streaming content and digital assets to become a leader in esports.
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