Buyout firms must beware the unique legal, regulatory, and commercial issues that can complicate sports transactions and impact returns.

By Patrick Mitchell, Alex McCarney, Stewart Robinson, Catherine Campbell, Tom Evans, and David Walker

Private equity interest in sports assets has grown over the last few years, with investments in teams, leagues, and other members of the sports ecosystem. Sports investments by sponsors, including CVC’s US$8 billion sale of Formula One racing in 2017, have underlined the strong returns available.

Today, the COVID-19 crisis, with the stresses that it has placed on sports media, sponsorship, and match-day revenue streams, has created new opportunities for investors — and interest is accelerating. Financial sponsors are continuing to seek out opportunities. Firms have invested in, or are in the process of investing in, a range of sports, from martial arts to football, and rights holders are signalling that they would welcome investment to see them through and beyond the current crisis.

Increased revenue, improved governance, and innovative financing in Serie A are drawing interest from overseas investors.

By Giancarlo D’Ambrosio

In the 1980s and 1990s, Italian football dominated the European football industry, achieving consistent success on the field and attracting a vast global audience. Italy’s top division, Serie A, is still among the best in the world, but the English Premier League and Spain’s La Liga have overtaken Serie A as a financial force. The Premier League and La Liga have developed and commercialised their products in the overseas market in recent years, creating a gap between them and rival European leagues. Yet a shift is underway, and — due to more stable revenues, improved governance, and innovative financing structures — Italian football is ready to re-join Europe’s financial elite.

Italian football investment is ready to kick–off. Increased revenue from TV rights deals will drive improved financial performance and present opportunities for investors. This past summer, broadcasters Sky and Perform sealed a deal to screen Serie A fixtures for €973 million per season until 2021, following a competitive auction process. The domestic rights deal followed an agreement to sell international rights to IMG for €371 million, at nearly double the rate of the previous cycle. Changes to Champions League regulations, allowing four Serie A clubs to qualify for Europe’s elite tournament, will further boost revenue in 2019.