La Liga Agrees to $3 Billion Private Equity Investment

TOKYO — Spain’s top soccer league has agreed to a deal in principle to sell 10 percent of its business to a private equity firm, CVC Capital Partners, for around $3 billion, according to executives with knowledge of the deal.

If approved by the league’s clubs, the deal could help the league’s cash-strapped teams, including giant ones like F.C. Barcelona, repair their finances and ease a cash crunch caused by the coronavirus pandemic.

CVC, a major sports investor, has been trying to strike similar deals with major leagues across Europe in recent years. It nearly reached a similar agreement with Italy’s Serie A for a share of that league’s media rights business before the deal faltered over objections from a group of teams. Something similar could happen in Spain, where the league, known as La Liga but encompassing the country’s first and second divisions, needs to secure the support of a majority of its 42 clubs at a general meeting to complete the sale.

While La Liga and CVC agreed to a price for a partnership that will run for several decades, representatives of the league and CVC have been meeting with club officials to secure their backing, according to the executives, who asked for anonymity because the deal has not been finalized.

La Liga and CVC did not respond to requests for comment.

The deal for an ownership stake would be the first of its type by a major European league, and it would come as the soccer industry works to get its finances on track after being buffeted by the lingering effects of the coronavirus. The pandemic, which closed stadiums for months, resulted in billions of dollars in lost revenue and exposed the precarious business models of some of the sport’s top clubs, where profligate spending and bad decisions regularly put teams at risk of bankruptcy.

The CVC/La Liga agreement comes at a particularly delicate time for Spanish soccer. Its two biggest clubs, Barcelona and Real Madrid, are still trying to forge ahead and create a breakaway European Super League, a midweek club competition for the continent’s top teams, after an initial effort to launch the project failed spectacularly in April. One of the biggest objections to that project came from La Liga, whose president, Javier Tebas, remains a vocal critic of the scheme that he said would destroy the fabric of European soccer.

Yet much of the rationale for the teams’ breaking away is similar to the motivation for La Liga to join up with CVC. The pandemic has been punishing financially for European soccer clubs, particularly those with the largest stadiums, who are losing billions of dollars of revenue and struggling to meet outsized payroll commitments.

Barcelona’s finances have attracted the most attention. The team has been desperately trying to restructure its debt under a new president, Joan Laporta, and has been told by the league that it needs to shed about $200 million in salaries to re-sign its biggest star, Lionel Messi, whose contract expired at the end of June.

Any deal for an infusion of private equity money would most likely require the commitment of Barcelona and Real Madrid to the league. The teams account for much of the league’s global visibility and popularity, and despite their flirtation with the Super League, Barcelona’s need for immediate cash to meet La Liga’s spending caps may weigh on its decision on the CVC offer.

Still, it is not certain that Spain’s clubs will accept the deal. In Italy, a $2 billion deal with a CVC-led group for a similar 10 percent stake floundered because a handful of the biggest teams, including the would-be Super League members Juventus and Inter Milan, said the price was too low.

CVC has been on a sporting buying spree as it bids to become the biggest player in a relatively new market for prime European leagues and competitions. It has sealed numerous deals in rugby over the past year, including one in March that saw CVC agree to pay 365 million pounds (about $500 million) for a share of the Six Nations Championship, Europe’s top national team rugby competition.

CVC’s proposed soccer investments would be the biggest commitment of its resources since its hugely profitable exit from the Formula 1 car racing series in 2017. CVC previously held conversations with soccer’s global governing body, FIFA, about investing in new competitions, and it was on a shortlist of companies Germany’s Bundesliga was considering partnering with before scrapping the idea of a stake sale.