The two highest Spanish leagues are taking 150 million euros for the granting of their naming rights to EA Sports for five years. Would that also be a deal for the Bundesliga after the failure of the investor’s entry? The matter is complicated.
There is still a financial need at the DFL. IMAGO/sport photo pack
It’s not like there is no financial need in the German Football League. This applies to the GmbH, which is responsible for rights marketing and organization, as well as the 36 clubs in the league association. And as is well known, the investor process did not fail because of this. There is broad agreement on the need to further develop the business model and invest money in digital infrastructure and internationalization.
Even among those who ultimately broke the procedure. Apparently, the sum (two billion euros) was too high for them, as were the taxes (12.5 percent). In addition, they were apparently skeptical about the business model with a private equity partner at their side. However, the new DFL management from Dr. Marc Lenz and Dr. Steffen Merkel recently.
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Almost exactly a year ago, experts from DFL-GmbH calculated that it would take a mid-range, three-digit million amount to keep up with the French Ligue 1 and the Spanish La Liga – both of which have a private equity investor on board with CVC. Most recently, there was talk of around 750 million euros. Opponents of the investor process such as Eckhard Sauren, Vice-President of 1. FC Köln and himself active in the financial sector, campaigned for outside financing.
However, Hans-Joachim Watzke, spokesman for the league executive committee and managing director of Borussia Dortmund, put a stop to a loan of such an amount. Quite understandable that the big ones like FC Bayern or BVB see a risk of individual payment defaults when you take a look at the financial situation at Hertha BSC, 1. FC Nürnberg or FC Schalke 04. Lenz and Merkel are also considered to be supporters of so-called “domestic financing”, i.e. without raising outside capital.
EA Sports pays heavily
The 750 million euros would hardly have to be financed all at once, but gradually. A naming rights deal, like the one La Liga has now pulled through for the second time, could redeem a first, big chunk. The Banco Santander once paid the Iberians almost 20 million euros a year, now EA Sports comes and puts ten million euros on top.
If the Bundesliga and 2nd division found a similarly powerful partner for maybe even ten years, 300 million euros would come into the coffers in one fell swoop. The sum would have to be pre-financed. A bank would, of course, be compensated accordingly, which would mean, for example, “only” 270 million euros. The board of directors of 1. FC Köln campaigned for such a deal shortly before the failure of the investor process. But does a model like that in Spain also work in Germany?
What experts say about the possibilities for the Bundesliga
This already exists in ice hockey (Penny-DEL), basketball (easy-credit-BBL) and handball (liqui-moly-HBL), albeit on a much smaller level, with low to maximum medium seven-digit amounts. The main difficulty in football lies in finding a partner. An experience that the league had to make at the beginning of the millennium. Vodafone wanted to get involved in 2003 – but even then the logo of the competitor “T-Mobile” was emblazoned on the uniform of the industry leader FC Bayern. “We will not accept Vodafone as a league sponsor. That cannot be done with FC Bayern. We have now informed the DFL in writing,” the then Munich CEO Karl-Heinz Rummenigge was quoted as saying.
Exclusivity is a valuable asset in sponsoring. This can be explained using the example of car manufacturers. A “Toyota Bundesliga”, for example, would hardly be possible. Almost all 36 DFL members have their own “car partner”, and several car manufacturers are also shareholders (FC Bayern: Audi, VfL Wolfsburg: VW). And a constellation like that at VfB Stuttgart, where Porsche is now also joining Mercedes, is likely to remain the exception for the foreseeable future. A few years after the Vodafone advance, there were talks with Microsoft and the logistics group UPS, later with Postbank, and Telekom is said to have been very interested. But in the end, the naming rights were never granted.
But how realistic is it that the league redeems a similarly substantial sum as the Spaniards? Experts outline to the kicker that on the one hand, La Liga naturally has a different international reach – keyword South and Central America. On the other hand, the Bundesliga and 2nd division can score with an enormous visitor potential in the stadiums. A lot would depend on the orientation of the potential partner. So the question of whether its focus is more on the world market or on the DACH region, i.e. Germany, Austria and Switzerland. The specific rights structure is just as decisive, for example the question of how present a Bundesliga sponsor would be on the boards of all stadiums, maybe even on the jerseys. The most complicated thing, as the experts agree with regard to sponsor exclusivity, is ultimately the search for a partner with whom all 36 league representatives could live.
2023-07-07 11:38:38
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