Spain’s Top Soccer League to Sell Majority Stake in Tech Unit

Spain’s top soccer league LaLiga is working with KMPG to sell a majority stake in its technology services unit, which focuses on player analysis and stadium logistics, in order to speed up growth in the business.

LaLiga aims to sell to a financial investor a 60% stake in LaLiga Tech, which has an enterprise value of 450 million euros ($547 million), LaLiga managing director Jose Guerra Alvarez said in an interview. Potential buyers have already been shortlisted and an agreement is expected to be reached by the end of the current season in May, with the aim of launching the new project before the end of 2021, he said.

“In the last seven years we’ve been developing a significant technology capacity for over-the-top streaming services, anti-piracy, as well as players’ statistics analysis and the management of fans’ access to our stadiums,” said Guerra. “We can now compile data to improve their engagement and generate new sources of income for both the league itself and our sponsors.”

Data analysis has been playing an increasingly significant role in different sports leagues worldwide. Real time statistics on players and teams are collected to design predictive models and refine decision-making processes on tactics, players’ workouts and team strategies. Fans’ interaction with clubs is also studied to boost sales of merchandising and other products.

LaLiga Tech currently has deals with its Belgian counterpart Jupiler Pro League and Dorna Sports - the rights holder of top international motorcycle racing MotoGP - to grant them access to its anti-piracy tool, known as LaLiga Content Protection.

Tools developed by the platform include pitch-side cameras and GPS-based player analysis to try and limit injuries. In-game analysis is also used to evaluate their performance for tactical purposes. The software, dubbed as Mediacoach, is accessible via the cloud, and more than 40 clubs are currently working with it.

Decreasing Revenue

The entrance of an external investor is meant to diversify the sources of revenue and is not directly linked to the league’s core business, said Guerra. Unlike other organizations that had to tap international funds to ensure their viability in the midst of the coronavirus pandemic, LaLiga “didn’t need to seek help, the financial markets are still confident,” he said. “TV rights had an impact lower than 5% on our target for last season, while in other countries, such as France, they reached 30%. We’re reacting to the pandemic better than other leagues.”

The closing of stadiums and the consequent drop in merchandising sales, alongside a standstill in the player transfer market, have led to a shortfall of about 1.4 billion euros for Spanish clubs, or almost 30% of their total revenue.

Clubs are “suffering, but not more than in other industries. I don’t see any of them generating non-payments,” said Guerra.

The executive sought to ease concerns over mounting debt at FC Barcelona, one of the league’s top teams.

“Its 480 million euros net debt is less than one time its net revenue of about 700 million, and that’s better than any member of the IBEX 35 benchmark,” said Guerra. “The pandemic hit big clubs harder, as their stadiums generate the highest income. Barcelona has, of course, been affected, and had to increase its debt, but I don’t think the situation is worrying.”

©2021 Bloomberg L.P.

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