CVC ‘in talks’ over ten-year Serie A media-rights investment

Private equity company CVC Capital Partners is lining up Serie A for its next sporting investment, it has been claimed, through a deal involving the sale of domestic broadcast rights to the top division of Italian club football.

CVC has held preliminary talks to present a proposal under which a newco would be created to manage and resell Serie A’s rights, potentially for a 10-year period, reports Il Sole 24 Ore.

The offer covers the rights from 2021-22 onwards.

CVC’s proposal, which is said to be in its ‘in its infancy’, comes after other projects studied by private equity groups in recent weeks. On Saturday, Il Sole 24 Ore reported that US-based private equity group Blackstone was prepared to offer Lega Serie A a €100m ($108.3m) loan to meet the short-term needs of clubs during Covid-19.

CVC’s reported interest comes with the private equity giant having closed in on an investment in the Six Nations rugby union tournament. CVC has been in talks with the Six Nations about acquiring a 14-per-cent stake, but it was reported last month that the deal has been delayed due to the pandemic.

The Infront agency holds a six-year near €6bn minimum guarantee agreement with Lega Serie A to work as its exclusive adviser on domestic and international rights media-rights sales, but that deal comes to an end in 2021.

A stumbling block in any deal with CVC could come in the form of Italy’s Melandri Law. The legislation prevents the sale of all broadcast rights to a single entity. There are those, however, who argue that the rule should only apply to a company capable of broadcasting the matches and not an intermediary.

On Friday, Serie A clubs reiterated their desire to finish the 2019-20 season at a Lega assembly meeting, but doubts remain over the fulfilment of the league’s domestic and international broadcast rights contracts.

Friday’s meeting landed on the same day that domestic rights-holders Sky Italia and DAZN, plus the league’s international rights agency IMG, were due to make their latest rights fee instalment as part of their deals running from 2018-19 to 2020-21.

The clubs discussed the issue at the assembly meeting and reiterated their position that the broadcast rights-holders should not be offered discounts.

Domestic live rights to Serie A games are currently held by Sky, the pay-television broadcaster, and DAZN, the subscription OTT service, in deals worth €973m per season.

IMG’s deal is worth just over €380m per season for international broadcast rights, club archive rights, betting rights, a marketing spend and fee for access to the broadcast signal. All three are thought to have been looking for a deferral on any rights fee payment given the current suspension of the league and no visibility on when – or if – the 2019-20 season will resume.

The reports concerning investment in Serie A come after the general assembly of France’s Professional Football League (LFP) yesterday (Monday) adopted a resolution that will enable the league to take out a state-guaranteed loan to make up for the shortfall in broadcast rights monies caused by the termination of the 2019-20 season.