Apollo Global Management is planning to offer Liga MX a roughly $1.25 billion investment in exchange for a share of the Mexican soccer league’s international media revenue, according to someone familiar with the plan.
The private equity giant (NYSE: APO) is seeking 20% of the profits from the league’s non-Mexican media rights over the next 50 years, according to a 20-page deck that was reviewed by Sportico. It’s a bet that Liga MX, which is by far the most-watched soccer league in the US, has a lot of commercial growth in its future beyond Mexico.
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The Apollo proposal, which is dated May 2022 and labeled “Project Goal,” is contingent on Mexican teams agreeing to sell their broadcast rights as a whole. Unlike most major US and European leagues, Liga MX currently allows individual teams to ink their own commercial partnerships. That’s allowed bigger clubs like Chivas and Club America to sign lucrative broadcast deals in the US, which has more than 36 million people of Mexican descent.
Liga MX could formally receive the pitch as early as this week, according to the source, who was granted anonymity because the details are private. Representatives for Liga MX and Apollo didn’t respond to requests for comment sent on over the weekend.
Apollo’s proposal is just the latest example of the world’s largest private equity firms increasingly looking at opportunities in global sports. Many of those deals have followed a similar format—the league splits its commercial rights into a separate joint venture and then allows investment into that entity. In addition to profit share, Apollo would also own 20% of that media company.
It’s similar to CVC’s $2.4 billion deal with Spain’s LaLiga, and the roughly $200 million partnership between Silver Lake and New Zealand Rugby, which goes to a final vote next month. Italy’s Serie A and Germany’s Bundesliga also explored allowing private equity investments into their media rights; MLS had a similar deal years ago with Providence Equity.
A Liga MX deal will be more complex because of the added step of getting its teams, particularly the biggest ones, to agree to pool their rights. In the US, for example, Liga MX games are spread across several networks, including FOX Deportes, FS1, FS2, Univision, UniMas, Telemundo, Universo, TUDN, ESPN Deportes and ESPN+.
The Apollo proposal includes a slide about what the New York City-based firm can offer Liga MX. It includes underwriting transactions such as broadcast rights, sponsorships and stadium financing, plus its deep experience in both credit and private equity deals. It highlights Apollo’s ability to be a one-stop strategic partner without impacting the day-to-day management of the league and its 18 teams. The $1.25 billion investment, according to the deck, would ultimately flow down to clubs for use in academies, stadiums, or other expenses.
Founded in 1990, Apollo has $498 billion of assets under management and has 17 offices across the world. The firm’s sports work includes financing for some of European soccer’s biggest teams, and major US leagues like the NBA, NFL and NHL.
Mexican soccer draws the largest crowds on average of any soccer league in the Americas and the third-largest audience of any professional sports league in North America, behind the NFL and MLB. It’s also the most-watched soccer league in the US—Liga MX games on Univision drew 920,640 viewers in the US this season, more than English Premier League games on NBC (788,620) and English-language MLS matches on Fox (436,750).
Liga MX was long considered a risky investment because of alleged corruption, lack of commercial deals beyond North America, and the financial imbalance between the top clubs and the rest of the league. But that’s beginning to change. Last year a group of US investors bought into Club Necaxa, which was recently valued at over $200 million in a subsequent round of investing, and a few other structural changes have made the league more attractive to foreign investors.
They include the temporary freezing of promotion and relegation, optimism over shared commercial rights, a commitment to more transparency, and increased cooperation between Liga MX and MLS. The two have discussed a possible merger, and recently co-launched the Leagues Cup, a World Cup-style club tournament that will debut next year.
The tournament will replace the current version of the Leagues Cup and is expected to increase exposure for Liga MX clubs by adding more high-profile games to their broadcast schedules. US media rights for that new event are currently being sold by MLS.
With assistance from Anthony Crupi.
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