Bundesliga Breaks Off Private Equity Talks Over Media Rights

Germany’s elite soccer body has discontinued discussions with a number of private equity firms about the possibility of selling a minority stake in a company that manages the Bundesliga’s overseas media rights.

The decision taken by the country’s top clubs comes after a similar $2 billion deal involving Italy’s Serie A hit a snag in February, Bloomberg News reported at the time.

Both leagues had put out proposals to financial firms in an effort to bring in much needed investment and additional expertise in broadcasting and technology to counter the hit from the pandemic.

“After weighing the facts, the Bundesliga and Bundesliga 2 clubs have decided not to continue the talks for the time being,” the DFL soccer organization said Wednesday in an emailed statement. It added it had been contacted by various private equity firms who had expressed interest in a strategic investment.

Private equity companies have been increasing their investment into sports ventures, striking deals for Toulouse in the French league and Burnley in the U.K.’s Premier League, and also investing in tournaments such as Formula 1 and the Six Nations Rugby Championship.

However, there has been push-back against major financial bets in sports amid the blowback from a failed effort to form a breakaway soccer European competition.

Silver Lake Management LLC’s attempt to buy a stake into the media interests of the All Blacks, the iconic New Zealand national team, has run into opposition from the players, who have themselves proposed an alternative plan which would see shares sold to the public instead.

“Valuations are clearly depressed in this market,” says Adam Sommerfeld, managing partner at Certus Capital Partners. “I think a lot of clubs feel they have been a bit blindsided by the approaches and many have not come to an agreement about the private equity thesis and what it might mean for them.”

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