Germany’s Bundesliga shows red card to private equity money

Germany’s top football clubs have voted against selling a stake in the league’s media and commercial rights to private equity firms, marking the second time they have rejected taking financial investors’ cash.

The plan to sell a stake in the media rights failed to secure a two-thirds majority from Deutsche Fussball Liga’s 36 members (DFL), the head of the DFL’s supervisory board said on Wednesday. The DFL runs Germany’s top two leagues.

“The majority of the clubs voted in favour of the project, but it was four votes less than the two-thirds majority desired by the DFL executive committee, and to continue the talks with the investors,” Borussia Dortmund’s chief executive and DFL supervisory board head Hans-Joachim Watzke said.

The DFL’s interim managing director Axel Hellmann added that some members had expressed surprise at the outcome of the vote.

The failure to secure the support of the DFL is a blow to a group of private-equity firms including Blackstone, Advent International and CVC Capital Partners, which were vying to buy a 12.5 per cent stake in the media rights business, according to people familiar with the matter.

If the two-thirds majority had been secured then negotiations would have been able to continue with the bidders.

Private equity’s push into football media rights has divided opinion among fans, the leagues and clubs. Wednesday’s vote attracted a small group of protesters outside the hotel where it was held. They were opposed to the DFL taking private equity cash.

France’s Ligue 1 and Spain’s La Liga have both previously sold stakes in their media rights to CVC Capital Partners. CVC’s €2bn financing deal with La Liga also received pushback from some clubs, including Barcelona and Real Madrid, but was still completed.

Italy’s Serie A abandoned a €1.6bn deal to buy a 10 per cent stake in a new company managing Serie A’s broadcasting rights, after opposition from clubs.

The collapsed sale in Germany marks the second time that the DFL has voted against private equity money. In 2021, the league voted to back out of talks to sell a stake in a new-media company that would hold the rights to broadcast Bundesliga games outside Germany.

That process attracted interest from a range of private equity firms, including CVC and KKR among others, the Financial Times has previously reported.

The league again kicked off talks to sell a stake to investment firms earlier this year and attracted interest from some of the buyout industry’s biggest names.

Any deal would have been a rare bright spot for firms that have seen deal activity slump so far this year. Concerns over the wider macro environment and a lack of access to debt financing have weighed on dealmaking globally.

The decision took some of the bidders involved by surprise, people familiar with the matter said, and the second rejection raises questions about whether the rights will come up for sale again.