Italy’s top football league has entered talks with private equity firms about selling a stake in its media rights company as it considers options to raise funding.
The Serie A is working with advisers from Lazard on a potential deal, according to those familiar with the details.
Private equity owners could buy a 10 to 20 percent stake in the league’s media rights, which could make Serie A a billion-dollar investment, one of the people said.
That process involves a separate set of negotiations. Two other people close to the talks said Serie A would first negotiate a five-year media rights contract with broadcasters from 2024.
Talks with the private equity firms will only continue if the clubs fail to agree on a price with media companies such as Sky and DAZN, the people said.
A deadline for broadcasters to submit their bids expires next week. Those close to Serie A expect bids to be below the clubs demand target and expect price negotiations to last into July.
“It is still early days, but we hope to eventually reach a price agreement with the broadcasters,” says the owner of one of the football clubs. “In that case, we don’t need any extra money.”
Only if those talks fail will Serie A start exploring other options, the people said.
A group of investment firms is expected to be one of the interested parties in a media rights sale, and talks have begun with at least one lender who would help fund any deal, some people said.
Italian football clubs have long hesitated to give up ownership of their media rights. An attempt led by private equity firm CVC to buy a €1.6bn minority stake in the media rights trade was rejected by the clubs in 2021.
Any deal is likely to come with complications, despite financial investors’ continued interest in sports media rights.
Serie A has held talks with private equity firms on several occasions, but opposition from individual clubs and their executives has derailed the negotiations.
In an interview last year, Serie A president Lorenzo Casini said investments in football infrastructure, such as stadiums, by foreign investors picking up Italian clubs could also benefit from the value of the league’s media rights, particularly outside Italy.
An initial offer from CVC in late 2020 also provided for the construction and maintenance of stadiums across Italy through a new infrastructure fund, as well as a 20 percent stake in the media business.
However, the Italian league continues to be in urgent need of new funds as revenues lag significantly behind other major European leagues such as the English Premier League and the German Bundesliga.
The Bundesliga last month rejected an offer to sell a stake in the league’s media and commercial rights to private equity firms. Although most clubs voted in favor of the offer, the result fell short of the required two-thirds majority, ultimately derailing the fund’s second attempt to buy a stake in the German football league’s coveted media business.
Other European leagues, such as Spain’s La Liga and France’s Ligue 1, have struck media rights deals with private equity firms after the pandemic hit their revenues.
Serie A and Lazard declined to comment.