This Friday, March 18 promises to be another decisive day for Vincent Labrune, the president of the Professional Football League (LFP). Indeed, the former boss of Olympique de Marseille will present to the clubs the offers of the finalist funds who want to invest in the future “Mediaco”, the commercial subsidiary that the LFP intends to launch to develop the income of French football. L’Express you have already detailed the main lines of the project on which Vincent Labrune has been working since his arrival at the bedside of French football. Now is the time to make it happen.
After a first round which brought together a dozen interested parties, the file is refined around four heavyweights of the sport business: Silver Lake (already an investor with the All Blacks in rugby and the City Group of Abu Dhabi), the specialist CVC (6 Nations Rugby and Spanish Football League), Oaktree (shareholder of Stade Malherbe de Caen) and Hellman and Friedman (present in Formula 1). These four funds audited Vincent Labrune and his close guard, grilling the business plan of the former president of OM. “The League reminded them of its desire to multiply its income by three over the next ten years. The funds challenged them and they judged the scenarios credible. They are ready to invest”, indicates to L’Express a source close to the file .
“Four almost firm offers, it’s a real performance given the context”
Quite close offers
According to our information, the financial proposals of the four finalists are very close, all the players having finally agreed to align themselves with the financial objective demanded by the LFP, namely to inject 1.5 billion euros through a minority stake in the Mediaco. Still according to a good source, the fund that will be retained should ultimately take between 13% and 14% of the capital of the future company. “Having four almost firm offers is a real performance given the current context. Between inflation, the war in Ukraine and the crisis in Tech, it’s almost a miracle”, summarizes one of the advisers of the transaction.
It must be said that the LFP has done everything to reassure its future investors. Despite its early elimination in the Champions League, the management of PSG has unofficially assured that the investment of Qatar will be permanent. A condition sine qua non of the operation as the funds have made PSG the locomotive of the project. They were also reassured as to the possible presence of Canal+ in the next call for tenders TV rights. Vincent Labrune has indeed told them that there was “no desire to crush Canal”, but to free themselves in some way from a form of “Canal dependence”.
To support his point, the boss of the League is convinced that a better division of the lots will keep the market under tension. And therefore in competition. It is also counting on the operational know-how of the future partner to quickly draw the outlines of the call for tenders. The funds were particularly attracted by the presence of Amazon on the French market. The other good news came from DAZN, which has seen its resources reinforced recently, but also from Apple, which is eyeing the sports market more. On the funds side, we are convinced that all these players will be on the starting line for the 2024-2028 period.
“The funds asked for guarantees” on the arrowing of the money
Finally, the last sensitive element that remains to be stabilized: the use of income. In the interview he gave to L’Express at the end of 2021, Vincent Labrune was very clear about his intentions: there will be no proportional distribution, it will be meritocracy, both in sporting terms (course in the European Cup) than on the business generated. “The funds were suspicious that the money was used for something other than development. They asked for guarantees,” said someone close to the case.
It could therefore be that the clubs are prohibited from raising the money to their shareholders. Additionally, clubs with negative equity could be declared ineligible altogether. The financial policeman of the LFP, the DNCG, could be the guardian of the temple and monitor the movements on the accounts of the clubs. For investors, who want to keep visibility on the use of their money, these measures could be as many conditions of their disinvestment.
Regarding the schedule, two of the four finalists should be selected after this Friday’s presentation to go through more formal oral presentations early next week. The file should therefore quickly accelerate because neither the LFP nor the funds want to delay. “Given the geopolitical and macroeconomic context, we have to come to an agreement quickly. We have firm offers on the table, they will not be there forever”, concludes one of the protagonists of the file.