August 04, (THEWILL) – Monetary relief has come the way of clubs in the top division of the Spanish football League, especially the likes of giants Barcelona and Real Madrid, whose financials took a beating due to the scourge of the coronavirus, as La Liga has managed to secure a lucrative agreement with CVC worth €2.7 billion.
The cash injection will be cheering news for the Santiago Bernabeu reconstruction managers at Real and for Joan Laporta, the beleaguered President of Barca attempting to bring club icon Lionel Messi back into the fold before the new season kicks off.
The investment from CVC is the culmination of an extensive process that had been in operation for about a year now. It is the model of investment aimed at facilitating growth at all La Liga Santander clubs once approved. The objective will be to directly invest 15 percent of the €2.7bn into reinforcing team squads and to signing players.
For the remainder, the plan of the Spanish League management is to invest it in the very significant necessity of structural improvements at the stadiums and facilities of La Liga for the long-term project of keeping them in pristine and optimal conditions.
The next stage in the process is for the investment to be approved by the clubs of La Liga. If done, a disbursement of funds will see about €270m go to Barcelona and about €261m to Real and so on down the line.
That sort of cash input will be the answer to Laporta’s prayers. As THEWILL reported about the club’s attempts to resign Messi, a deal had been worked out but was dependent on some heavy financial flow to stay within La Liga spending limits and was giving the club president sleepless nights.
With €270m, the club can speedily confirm that business, get Messi to sign the papers and get into their final rounds of pre-season preparations while Laporta gets a breather before resuming the all-important tasks of cutting down Barca’s wage bill and frivolous spending.
On Real’s side, the injection of their own cut of the largesse will immediately make their bid to bring Kylian Mbappe to the Bernabeu a lot more realistic, while they can do so much of what is left of the stadium reconstruction with some of the money they will bring in.
On the other side of the League, small teams will also see a good deal of the money improve their coffers as well. Levante, for instance, who were having to tighten their belts in order to meet La Liga’s salary cap, will have some needed temporal relief.
About 15 percent of the entire investment will be distributed by taking the television income of the last seven seasons into account as the CVC is investing money that will be managed by La Liga, with some agreed fees paid to CVC. If everything pans out accordingly, it will be a windfall on the investment for both the League and CVC.
Last year, the CVC was part of a consortium which entered talks to buy a stake in the media business of Italy’s top soccer league, but the deal fell through following objections from some clubs with the terms.
Under the terms of this Spanish deal, La Liga would set up a new company to house commercial elements, such as sponsorship deals, the league’s technology arm La Liga Tech and their joint U.S. venture, including plans to stage a league match in the United States, in which CVC would take a tenth.
The continued management of the league’s sporting responsibilities and its audiovisual rights business would remain outside the scope of the transaction, as La Liga said. “When it comes to the rights strategy and sales, this will continue to be handled by La Liga.”
What the boost from the investment will help with it to see the Spanish league match or exceed the English Premier League’s business in the next six to seven years.
On the part of the CVC, which used to own Formula One, the deal would add to its interests in sport. It agreed in March to invest 365 million pounds for a share in rugby union’s Six Nations tournament, grouping France, Ireland, England, Scotland, Wales and Italy as an aspect of the expansion of its investment scope.
Injection Of €2.7bn Into La Liga May Aid Messi Contract And Boost League’s Influence
By Jude Obafemi
Monetary relief has come the way of clubs in the top division of the Spanish football League, especially the likes of giants Barcelona and Real Madrid, whose financials took a beating due to the scourge of the coronavirus, as La Liga has managed to secure a lucrative agreement with CVC worth €2.7 billion.
The cash injection will be cheering news for the Santiago Bernabeu reconstruction managers at Real and for Joan Laporta, the beleaguered President of Barca attempting to bring club icon Lionel Messi back into the fold before the new season kicks off.
The investment from CVC is the culmination of an extensive process that had been in operation for about a year now. It is the model of investment aimed at facilitating growth at all La Liga Santander clubs once approved. The objective will be to directly invest 15 percent of the €2.7bn into reinforcing team squads and to signing players.
For the remainder, the plan of the Spanish League management is to invest it in the very significant necessity of structural improvements at the stadiums and facilities of La Liga for the long-term project of keeping them in pristine and optimal conditions.
The next stage in the process is for the investment to be approved by the clubs of La Liga. If done, a disbursement of funds will see about €270m go to Barcelona and about €261m to Real and so on down the line.
That sort of cash input will be the answer to Laporta’s prayers. As THEWILL reported about the club’s attempts to resign Messi, a deal had been worked out but was dependent on some heavy financial flow to stay within La Liga spending limits and was giving the club president sleepless nights.
With €270m, the club can speedily confirm that business, get Messi to sign the papers and get into their final rounds of pre-season preparations while Laporta gets a breather before resuming the all-important tasks of cutting down Barca’s wage bill and frivolous spending.
On Real’s side, the injection of their own cut of the largesse will immediately make their bid to bring Kylian Mbappe to the Bernabeu a lot more realistic, while they can do so much of what is left of the stadium reconstruction with some of the money they will bring in.
On the other side of the League, small teams will also see a good deal of the money improve their coffers as well. Levante, for instance, who were having to tighten their belts in order to meet La Liga’s salary cap, will have some needed temporal relief.
About 15 percent of the entire investment will be distributed by taking the television income of the last seven seasons into account as the CVC is investing money that will be managed by La Liga, with some agreed fees paid to CVC. If everything pans out accordingly, it will be a windfall on the investment for both the League and CVC.
Last year, the CVC was part of a consortium which entered talks to buy a stake in the media business of Italy’s top soccer league, but the deal fell through following objections from some clubs with the terms.
Under the terms of this Spanish deal, La Liga would set up a new company to house commercial elements, such as sponsorship deals, the league’s technology arm La Liga Tech and their joint U.S. venture, including plans to stage a league match in the United States, in which CVC would take a tenth.
The continued management of the league’s sporting responsibilities and its audiovisual rights business would remain outside the scope of the transaction, as La Liga said. “When it comes to the rights strategy and sales, this will continue to be handled by La Liga.”
What the boost from the investment will help with it to see the Spanish league match or exceed the English Premier League’s business in the next six to seven years.
On the part of the CVC, which used to own Formula One, the deal would add to its interests in sport. It agreed in March to invest 365 million pounds for a share in rugby union’s Six Nations tournament, grouping France, Ireland, England, Scotland, Wales and Italy as an aspect of the expansion of its investment scope.
About the Author
Jude Obafemi is a versatile senior Correspondent at THEWILL Newspapers, excelling in sourcing, researching, and delivering sports news stories for both print and digital publications.
