December 12 – Germany’s Bundesliga and Bundesliga 2 clubs have greenlighted a proposal to raise an estimated €1 billion in private equity investment in return for a 20-year share in their commercial rights.
Voting at the DFL Members Assembly in Frankfurt on Monday, 24 of the 36 clubs were in favour of the plan, just enough to give the proposal the necessary two-thirds majority to proceed.
The DFL said it will now begin negotiation with a number of interested parties over what it is calling “a strategic marketing partnership… in the form of a licence model that provides for the establishment of a new marketing company”.
The DFL’s media and other commercial rights will be licensed to the new company – DFL e.V. The private equity investor will have a minority interest in the company and will receive a maximum of 8% of the revenue from the sale of the DFL’s commercial rights for 20 years, the duration of the licence agreement.
While the overall sum to be invested has been put at about €1 billion, the DFL said “the exact amount of the investment will form part of the negotiations with the bidders, and, in addition to the key economic points, these negotiations will also include due diligence and the finalisation of the business plan in detail.”
The negotiations are expected to be completed by the end of March 2024.
The DFL said the new money will “secure the long-term and sustainable success” of the clubs and the top two divisions.
“The aim is for the Bundesliga and Bundesliga 2 to continue to be competitive in sporting and commercial terms, and remain financially stable while maintaining the balance between social integration and economic growth.”
In May, clubs voted against selling off a stake in their media interests to private equity. At the same time there was a management change within the DFL that was tasked with reworking what is essentially the same investment proposition.
Advent International, Blackstone, Bridgepoint, CVC Capital Partners, and EQT, have all been named as private equity firms that have expressed an interest though no detail has been given as to the final list of firms that are in negotiation with the DFL.
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