MADRID (Reuters) – La Liga has agreed in principle to sell 10% of a new entity that will combine most of its operations to private equity firm CVC Capital Partners for 2. 2.7 billion, the Spanish Football League announced on Wednesday.

La Liga, played by Real Madrid and FC Barcelona, ​​is valued at 24 24.2 billion. If approved, it would allow the league to fund “structural improvements” and offset the impact of the COVID-19 pandemic.

Real and Barസa have been struggling financially with recent funding, but it remains to be seen how much of this fund will be spent on transfers and player salaries.

La Liga has indicated that 90% of the funds will go directly to clubs to finance investment programs approved by the league.

Football leagues and clubs are facing the end of a cycle of growth in television rights, which have been virtually an “empty” year in ticket sales due to the epidemic. So they are looking for new sources of income.

The 12 largest clubs in Europe failed to create a “super league” at the beginning of the year, which increased the pressure on the region.

Transformation

Under the terms of the deal, La Liga will set up a new company for business activities such as “sponsorship” contracts and match returns, in which CVC will take a 10% stake.

La Liga has not specified what structural improvements it intends to fund, but these are linked to stadiums and sports facilities.

La Liga said the TV rights business would be out of business.

“The agreement aims to transform the entertainment world and maximize all growth opportunities for clubs,” she added.

Sources close to the Spanish league say that through this action, La Liga intends to equalize or overtake the British “Premier League” in the next six to seven years.

This agreement must be approved by the La Liga Executive Committee and the clubs.

For the CVC that held the Formula 1, this activity would allow them to strengthen themselves in the sport. In March, he agreed to invest 36 365 million (9 429.1 million) in a six-nation rugby tournament that will bring together France, Ireland, England, Scotland, Wales and Italy.

Last year the fund sought to acquire a stake in the Italian Football League media business but was met with opposition from some clubs.

(Report by Aishwarya Nair in Bangalore and Nathan Allen in Madrid, French edition by Blandin Henold, edited by Jean-Stephen Bros.)