# Spain’s La Liga attracts $3.2 billion investment from CVC Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2021-08-04 Category: BUSINESS Category URL: https://financedigest.com/category/business Meta Title: La Liga agrees to sell 10% stake to CVC Capital Partners Meta Description: Stay updated on La Liga's landmark deal with a private equity firm, set to bring in 2.7 billion euros for structural improvements and club investments. URL: https://financedigest.com/spains-la-liga-attracts-3-2-billion-investment-from-cvchtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2021-08-04t064336z1lynxmpeh7309srtroptp4soccer-spain-fcb-atm-report-1736838067229-compressed.jpg) (Corrects in seventh paragraph to remove reference to matchday revenue) MADRID (Reuters) -La Liga, Spain’s top soccer league, has agreed in principle to sell 10% of a newly formed company housing most of its business to private equity firm CVC Capital Partners for 2.7 billion euros ($3.2 billion), it said on Wednesday. The deal values La Liga, host to Real Madrid and Barcelona, at around 24.2 billion euros and, if approved, will fund “structural improvements” while offsetting some of the immediate impact from COVID-19, the league said in a statement. The [cash influx would be particularly welcome to those two clubs which have lately faced](https://www.financedigest.com/analysis-investors-face-expensive-quest-for-year-end-cash-and-safe-assets.html "Analysis-Investors face expensive quest for year-end cash and safe assets") unfamiliar constraints on their spending power, but how much of it leaks out into transfer fees and player wages remains to be seen. La Liga said some 90% of the funds raised will be channeled directly to clubs which must use the cash to finance [investment programmes](https://www.financedigest.com/board-of-russias-avtovaz-approves-585-million-in-2023-investment-programme-ria-agency.html "Board of Russia’s AvtoVAZ approves 5 million in 2023 investment programme – RIA agency") agreed with the league. Faced with the end of a cycle of rapid growth in the value of TV rights – and pummeled by a [year of next](https://www.financedigest.com/cepsa-to-nearly-double-investments-over-next-3-years-as-profit-soars.html "Cepsa to nearly double investments over next 3 years as profit soars") to zero ticket sales due to restrictions on crowds – soccer leagues and clubs not just in Spain are scrambling to find alternative sources of revenue. The failure of an attempt earlier this year by 12 of [Europe’s biggest clubs to set up a breakaway “Super League” ratcheted up pressure on incumbents in the business](https://www.financedigest.com/europe-burns-cash-to-help-businesses-in-deepening-energy-crisis.html "Europe burns cash to help businesses in deepening energy crisis"). COMMERCIAL ELEMENTS Under the terms of the deal, La Liga would set up a new company to house its commercial elements, such as [sponsorship deals](https://www.financedigest.com/soccer-nike-ends-sponsorship-deal-with-spartak-moscow.html "Soccer-Nike ends sponsorship deal with Spartak Moscow"), in which CVC would take a 10% stake. It didn’t [say what structural improvements it envisaged but these could relate to stadium](https://www.financedigest.com/in-a-stadium-of-their-own-migrant-workers-say-their-sweat-made-world-cup-happen.html "In a stadium of their own, migrant workers say their sweat made World Cup happen") and training facilities. Management of the league’s sporting responsibilities and its audiovisual rights [business would remain](https://www.financedigest.com/iran-open-for-business-but-caution-remains-the-watchword.html "Iran: ‘open for business’ – but caution remains the watchword") outside the scope of the transaction, La Liga said. This agreement aims to [lead the transformation that the entertainment world is undergoing and to maximise all growth opportunities for clubs,”](https://www.financedigest.com/owner-of-leading-discount-dining-clubs-tastecard-and-gourmet-society-appoints-new-chairperson.html "Owner of leading discount dining clubs tastecard and Gourmet Society appoints new Chairperson    ") it said. With the boost from the investment, the Spanish league hopes to match or exceed the English Premier League’s [business in the next six to seven years](https://www.financedigest.com/novartis-to-spin-off-generics-business-sandoz-next-year.html "Novartis to spin off generics business Sandoz next year"), a source close to La Liga added. The [stake sale](https://www.financedigest.com/sap-to-cut-3000-jobs-explore-qualtrics-stake-sale.html "SAP to cut 3,000 jobs, explore Qualtrics stake sale") still requires approval from the league’s executive committee and clubs. For CVC, which used to own Formula One, the [deal would add to its interests in sport](https://www.financedigest.com/britains-jd-sports-extends-nike-ties-with-partnership-deal.html "Britain’s JD Sports extends Nike ties with partnership deal"). It agreed in March to [invest 365 million](https://www.financedigest.com/germanys-merck-to-invest-300-million-euros-in-us-gas-plant.html "Germany’s Merck to invest 300 million euros in US gas plant") pounds for a share in rugby union’s Six Nations grouping France, Ireland, England, Scotland, Wales and Italy. As part of a consortium last [year it entered talks](https://www.financedigest.com/extraordinary-rollercoaster-good-friday-talks-remembered-25-years-on.html "‘Extraordinary rollercoaster’, Good Friday talks remembered 25 years on") to buy a stake in the media business of Italy’s top soccer league, but the deal fell through following objections from some soccer clubs. Earlier this year, La Liga expanded its partnership with Microsoft Corp in a bid to [boost revenue for its pandemic-hit soccer clubs and re-energise a fan base that is consuming ever-more digital products](https://www.financedigest.com/4-tips-for-creating-a-calm-workspace-to-boost-productivity.html "4 tips for creating a calm workspace to boost productivity"). ($1 = 0.8424 euros) [(Reporting by Aishwarya Nair in Bengaluru and Nathan Allen](https://www.financedigest.com/allen-overy-launches-commodity-finance-market-report-2018.html "Allen & Overy launches Commodity Finance Market Report 2018") in MadridEditing by Jason Neely and David Holmes) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---