As many as four private equity funds – including Silver Lake, CVC Capital Partners and Bain Capital – are assessing bidding for a stake of 20 per cent in a newly-created commercial subsidiary of French professional soccer’s governing body, the LFP, according to reports. 

It has been reported that the LFP has asked bidders – which would be those three firms plus one other – to submit initial non-binding offers by Monday 13 December, when a deadline has been put in place. 

According to Reuters, several other private investment firms – Advent, Apollo, Bridgepoint, EQT and KKR – are meanwhile weighing up a different opportunity to invest in the LFP’s media rights business, for a stake of potentially up to €1.5 billion ($1.69 billion).

The LFP began searching for private equity partners in late October, with the body having approached Centerview, Lazard and law firm Darrois to act as advisors. 

Between them, these bodies reportedly approached around 30 potential investors. 

The LFP is not the only soccer governing body across Europe to be attempting to bring in outside investment – earlier today, 37 of 42 clubs in Spanish soccer’s top two divisions voted in favour of an agreement with CVC that will see the fund take a 10-per-cent stake in a new commercial arm. 

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The entity has been created to support the top Spanish league’s global growth plans and financially stricken clubs amid the Covid-19 pandemic.

The CVC-LaLiga deal has been finalised (after many months of wrangling), despite a last-ditch attempt by heavyweights Real Madrid, Barcelona and Athletic Bilbao, to derail it. 

The same firm was also engaged in talks with Italy’s top Serie A league last year over a similar proposal to take a stake worth €1.7 billion in a newly-created rights vehicle, only for those discussions to fall through in February after opposition from seven clubs. They have since been resurrected according to reports, with CVC no longer involved.

CVC is also believed to have held initial discussions, which ultimately petered out, to invest in a proposed media rights vehicle of Germany’s Bundesliga.

It has been reported that the LFP would like to wrap up both auctions by the start of the second quarter of 2022, and that binding deals could be in place by the time the top-tier Ligue 1 season ends in May. 

In March, the French National Assembly voted to allow sports bodies to create the kind of commercial subsidiary in question here, as part of a wider sports bill. 

This came after the LFP’s member clubs voted in December 2020 to explore the possibility of creating such an entity, by reforming the body’s statutes. 

This statute amendment outlines, however, that the LFP “may not hold less than 80 per cent of the capital and voting rights of the company”, meaning that the governing body would maintain full operational control of the division. 

In October, Vincent Labrune, the LFP’s president, said that the creation of such a body was “imperative” to secure the future of professional soccer in France.

A commercial venture like this could see a redistribution of the way media rights revenue is split between the 40 clubs in Ligues 1 and Ligue 2. 

Currently, the two clubs generally accepted as the biggest in the country – Paris Saint-Germain and Olympique de Marseille – receive less than 10 per cent each of total revenue, a situation those heavyweights will no doubt push to change. 

PSG have already come out in favour of outside investment into the league. 

At a French government committee hearing earlier this week, Labrune said: “If we have a fair valuation [from an investment fund] that will allow us to save our system and provide funds to the amateur world and which will allow us to get off to a good start, we will seriously ask ourselves the question about moving forward.

“The objective is not to sell off our assets … If we don’t have anything satisfactory, we won’t do it.

“We have a very serious and very supervised process and it is out of the question that we will reiterate the mistakes we made in choosing the audiovisual partner in 2018 [when Spanish production firm Mediapro was chosen as the LFP’s main domestic rights partner, with disastrous eventual results].”

Currently, Ligue 1 secures the least revenue out of the European ‘Big Five’, behind Spain’s LaLiga, Germany’s Bundesliga, England’s Premier League, and Italy’s Serie A. 

Labrune also said earlier this week that the 40 teams collectively face a funding hole of up to €800 million after the damaging financial effects of the coronavirus pandemic over the last two years, with the collapsed media rights deal between the LFP and Mediapro also contributing to the shortfall. 

As such, he added that – with regards to inviting outside investment – “we have no choice … Our long-term future depends on the next 18 months.” 

Meanwhile, the second-tier Ligue 2 is set to move from 20 to 18 clubs ahead of the 2024-25 campaign, with the switch having been confirmed at an LFP meeting earlier this week. 

Lebrune said: “The reduction to 18 sides in Ligue 1, then in Ligue 2, demonstrates the union and the will of all clubs to create the conditions for an ambitious reform plan which will involve the creation of a commercial company.

“This decision to move Ligue 2 to 18 teams will allow us to work on the creation of a third professional division. With Ligue 2 and the National Championship, we must promote football in the territories.”

The decision comes after Ligue 1 confirmed it would also reduce its number of teams from 20 to 18, in time for the start of the 2023-24 season. 

It has contained 20 teams ever since 2002-03, and by reducing its number of clubs to 18, joins the Bundesliga on that number.