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Post by rugbytoffee on Dec 7, 2019 11:47:20 GMT
CVC Capital Partners, one of the world's largest private equity groups with $82.5bn of assets, have been approached by Real Madrid about creating a new global football league contest. Two leagues of 20 teams each are being considered. These would probably include the founder members of the World Football Club Association. Florentino Pérez, the Real Madrid president, is also president of this newly created body.
The founder members include Real Madrid, AC Milan, Auckland City, Boca Juniors and River Plate in Argentina, Club America in China and Maezmbe in DR Congo. Significantly, no Premier League clubs seem to be involved.
CVC is involved in talks with Fifa about acquiring the commercial rights to the revamped Club World Cup. The present eight team Club World Cup is to be replaced by a 24-team contest featuring at least eight European teams and taking place every four years. China will host the first expanded tournament in mid-2021.
CVC has a long history of acquiring and selling sports franchises, including Formula One. its 2005 bet on Formula One generated $7bn in returns by the time it sold out in 2016. It has recently done deals in rugby union. Investment in tournament franchises offers less volatility than bets on the big clubs themselves.
The proposal has provoked a strong reaction. Aleksander Ceferin, president of Uefa, condemned it as an insane plan that would ruin football around the world, all for the benefit of a tiny number of people. It would, of course, present a threat to the Champions League where discussions about securing more involvement for top clubs continue.
Premier League clubs derive 44 per cent of their revenue from broadcasting and would be concerned about anything that might threaten this income stream.
However, there is clearly an appetite for deals in football, the world's most popular sport, by top investors. How this plays out will be an interesting test of the limits to globalisation in football and how far big, foot loose capital can call the shots.
footballeconomyv
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