January 21 – After a prolonged battle with three of its clubs, LaLiga has seen the first injection of cash into its Impulso project from private equity firm CVC.
The €400 million first tranche is the start of what will be a total €1.994 billion investment by CVC into a new company that will hold LaLiga’s commercial rights, and in particular its audio-visual right. CVC will hold an 8% stake in the business for 50 years.
Barcelona and Real Madrid, joined by Athletic Club, had objected to the agreement arguing that it undervalued the rights and that the term was too long and could cause “irrepairable damage” to their business.
However, with Spain’s Administrative Court of Sport dismissing the legal challenge last week, the way has been cleared to complete the CVC investment.
“As of February 1, a new holding company – LaLiga Group – will be formed, to which the bulk of LaLiga’s activity will be transferred, and in which CVC will hold an 8% stake for the next 50 years. At that time, LaLiga clubs will receive a further €298 million,” said LaLiga.
LaLiga did not break down how much of the initial €400 million each club would receive but emphasised that the money came with conditions that require clubs to invest 70% of their allocation on “infrastructure, international development, brand and product development,communication strategy, innovation and technology plan, and a content development plan on digital platforms and social networks”.
Clubs can spend 15% of the money on players and 15% on helping with their debt.
“The clubs can now start implementing the development plans that have previously been submitted to LaLiga and will allow them to achieve a 20-year head start in the organisation’s modernisation processes,” said LaLiga.
Emphasising that the new money is targeted to help LaLiga compete and grow on the global stage, the league concluded: “This is the first step in a 50-year strategic project that willcatapult LaLiga and its clubs to new levels across the world. The alliance with CVC represents the addition of an industry partner with extensive global experience in the sports industry, bringing long-term capital and expertise to help LaLiga and its clubs grow globally at a time when there are great challenges and uncertainty within the entertainment industry.”
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