The First and Second Division clubs have already chosen their future. Despite opposition from Real Madrid, Barcelona and Athletic, who came to present an alternative plan (Sustainable Project) in the last week, Tebas carries out its LaLiga Impulso project by a landslide for the next 50 years. The agreement with CVC received 37 votes in favor, one abstention and four against. in a vote that will be taken to the courts, as the three opposition clubs have warned in recent days.
This result supposes the support to the plan of Tebas in front of the alternative of Real Madrid, Barcelona and Athletic, who presented a plan a week ago that would provide the same amount of money to the clubs (1,994 million euros) through a loan from JP Morgan, Bank of America and HSBC to be repaid in 25 years in what they considered better conditions. The clubs, consulted throughout this week by AS, remained loyal to LaLiga Boost for a reason: “The project with CVC is a strategic alliance with a partner to invest and grow, the alternative plan is only a financing”. A new staging of the confrontation that Spanish football has faced in recent years and that this last week has experienced a special tension with the intersection of statements and accusations between the employer’s association, the big Spanish clubs and the Federation. This agreement, like other previous ones, will also end in the Courts.
Although Tebas has been the winner in the fight with Madrid, Barcelona, Athletic and RFEF (the great opponents of this agreement), It has carried it out with less support than in the August vote. So there were 38 yeses and 4 votes against. Now, the result was 37 votes in favor, one abstention and four against. Lose a vote of confidence. It remains to be seen if the club that has abstained and the one that has voted against (in addition to Madrid, Barça and Athletic) join the Impulso project and take the money or decide to decline it. These clubs are not known as the vote is secret. A meeting that lasted about three and a half hours and was attended by all the clubs, although the presidents of Madrid and Barcelona delegated their representation.
LaLiga and the CVC investment fund become industrial partners with the aim of making the clubs and employers grow and transform to continue expanding internationally and achieve more income from audiovisual rights. The clubs will receive 1,994 million euros in exchange for transferring to CVC around 8% of the revenue from LaLiga’s commercial and technology business and 11% of the revenue from audiovisual rights over the next 50 years into a holding company that will now be established once the definitive agreement with LaLiga and individually with the clubs has been signed. As AS has already advanced, in this holding company, which will last half a century, CVC will only be present for no more than ten years and then a new partner will be made to whom the investment fund will sell its participation. Yes indeed, In this company, LaLiga will keep intact from this new company its sports competitions and the organization and management of the commercialization of television rights.
How does LaLiga Impulso work?
LaLiga Impulso has had to readjust to the refusal of Real Madrid, Barcelona and Athletic to join the project. They reject their share of the millions (about 700 million) in exchange for not giving up their 11% of television rights for the next fifty years. In this new adaptation of the agreement, CVC maintains its valuation of the Spanish competition at 24,250 million euros, but yes reduces its rainfall from millions to 1,994. This amount will be distributed among the 39 remaining clubs. RThey will receive this money in four payments: 40% now with the signing of the contract; 20% in June 2022, another 20% in June 2023 and the last payment, also 20%, in June 2024. By that date, it is expected that the clubs have managed to transform their infrastructure, strategy and developed their brand to increase their income.
LaLiga will monitor every euro that the clubs receive. For this they have a roadmap to follow: 70% of the money should be allocated to infrastructure and brand and strategy development; 15% may be used for financial debt and the remaining 15% for transfers and footballers’ salaries. It is possible that these percentages vary for some clubs, but must be approved by the LaLiga Delegate Committee. All the teams, since the agreement was announced in August, have been presenting their projects and strategies to the employers to allocate the money they receive. They range from the creation of universities, soccer schools or remodeling of their stadiums.
LaLiga statement
“The Extraordinary General Assembly held today at LaLiga has ratified the LaLiga Impulso project, the strategic agreement reached with the CVC investment fund, with a majority greater than the reinforced majority, to promote the global growth of LaLiga and its clubs.
Total, 37 of the 42 clubs have voted in favor of its materialisation, 4 against and one abstention, which will allow them to receive a total of 1,994 million euros to undertake growth and consolidation projects from a sporting and business point of view.
LaLiga Impulso aims to incorporate an industrial partner with extensive experience in Spain and in the sports field that contributes long-term capital and proven industrial experience to help LaLiga and its clubs grow globally at a time of great challenges and uncertainties for the industry of emotions and entertainment.
The new formulation approved today by the competent body of LaLiga guarantees the absence of impact between non-participating clubs. For the rest, this economic injection commits the clubs to allocate at least 70% of the resources to investments related to infrastructure, international development, brand and product development, communication strategy, innovation and technology plan and development plan of content on digital platforms and social networks, being able to have up to an additional 15% for the registration of players and the other 15% for financial debt.
This alliance is, therefore, a milestone for the sports industry in general and football in particular, due to all the investments that will be made in infrastructures and development within the clubs.. It is an agreement that will mean a 20-year advance in modernization processes that will benefit all of Spanish sport and will place it on a new world stage.
There are already many clubs that have presented their development projects detailing the investment and business plans to which the financing approved in this agreement will be used, which represents a historic boost for Spanish football.
The president of LaLiga, Javier Tebas, declared after the Assembly: “We are facing a new milestone in the history of LaLiga and the clubs. We are proud to have reached this agreement with CVC, a project that will allow us to continue the transformation towards a global digital entertainment company, strengthening the competition and transforming the experience of the fans ”. In addition, he added: “Despite all the obstacles that we have encountered along the way, we have carried out this project, which will be a before and after for LaLiga clubs, which will be able to improve their infrastructures, develop their brand internationally and take giant steps to continue strengthening sport and football around the world ”.
The signing clubs have agreed with the president of LaLiga and have been very satisfied after the approval of the project.
The only great future project for clubs
The ratification of the agreement by the competent body took place today since Real Madrid, FC Barcelona and Athletic Club requested to leave it in August. The departure of these three clubs brought with it the reformulation of the project, which today has been endorsed with the vote in favor of 39 of the 42 clubs, guaranteeing the absence of impact for those who are outside of it.
The ratification of the project signed today puts an end to a process of many months of work and exhaustive analysis in search of the best option to support and promote LaLiga clubs, which has had the professional advice of numerous prestigious firms, such as the case of the economic valuations of the operation carried out by Rothschild & Co and Duff & Phelps, respectively, or the consultancies of Uría Menéndez and KPMG, for LaLiga, and that of Latham & Watkins, for CVC “.