Serie A agree €1.7bn deal with CVC and Advent for stake in new rights holding business

November 20 – After months of twists and turns, Italy’s Serie A has finally agreed a deal to sell a 10% stake in a newly created media and commercial rights holding company to private equity firms CVC and Advent. They will pay a reported €1.7 billion for their position, delivering a much needed cash injection for the debt-laden clubs. 

“We have found an agreement and unanimously voted in favour of the financial terms of the proposal, but we haven’t closed the deal yet, we haven’t committed yet,” said league boss Paolo Dal Pino. “It’s like when you go up the stairs, you’ve got to get to the top but we’ve come a long way.”

The 20 clubs unanimously voted in favour of the CVC and Advent bid, bringing to an end a near-year long search for investors in Serie A. It is expected that the deal will be finalised in the next few weeks.

Earlier this year, various private equity funds and venture capital firms expressed their interest in investing in the Italian topflight. In February, CVC were the first to approach Serie A with a €2.2 billion offer to acquire 20% in a new company to manage the league’s broadcasting rights from 2021, the league’s international trademark and its commercial development.

CVC’s bid includes the backing of American private equity firm Advent and state-backed fund FSI. During summer, the consortium emerged as Serie A’ s preferred negotiation partner after a lengthy bidding war between the various other interested parties. Fifteen out of 20 clubs reportedly voted in favour of CVC’s bid, leaving Bain Capital’s bid sidelined.

Even before the coronavirus pandemic, Italy’s topflight clubs were burdened by collective debts running up to €4.3 billion, but the health pandemic further compounded finances, with the league expecting a €600 million loss this year, equalling nearly a quarter of annual revenue, due to a drop in both TV rights income and matchday revenue.

Serie A’s current broadcast rights cycles will come to an end next season, and the negotiations for a new broadcast contract will become one of the top priorities. Serie A’s TV income is significantly lower than Premier League, La Liga and the Bundesliga, generating €1.35 billion per season in its current media rights deal whereas the English top flight banks €3.5 billion per season.

Contact the writer of this story, Samindra Kunti, at moc.l1606269160labto1606269160ofdlr1606269160owedi1606269160sni@o1606269160fni1606269160