French football strikes back. The professional football league (LFP), forced Thursday, October 15 to a new loan to compensate for the late payment of Mediapro, the main broadcaster of Ligue 1, has put the Sino-Spanish group in default to pay, threatening to turn to other broadcasters. It is the executive director general of the LFP Arnaud Rouger who leads the response, the day of an emergency meeting of the board of directors of the body.
In a letter sent to the clubs on Wednesday and consulted by Agence France-Presse, Arnaud Rouger announced that he had “given (Mediapro) formal notice to settle the deadlines for the 1is and October 5 ”. Holder of most of the rights to Ligue 1 and Ligue 2 over the period 2020-2024 for more than 800 million euros per year, Mediapro is behind on the payment of installments due in early October, estimated by the daily The team to 172 million euros.
Arm wrestling
Mediapro boss Jaume Roures has engaged in a standoff with the League, demanding a delay in payment – which he has been denied – and a downward renegotiation of rights, which the Sino-Spanish group operates by through its new Téléfoot channel. The LFP, which was already indebted in the spring with a loan guaranteed by the State of 224.5 million euros to compensate for the premature end of the championship due to a health crisis and to feed the cash flow of the clubs, will be indebted once again with a loan which was on the agenda of the board of directors on Thursday and must be validated next Monday at a general meeting. Contacted, the LFP did not respond to requests from Agence France-Presse on the terms of this loan.
Read also Daniel Riolo: “France lacks intellectuals who think about football”
According to Arnaud Rouger’s letter, the League “obtained a competitive financing offer” and plans to make a first payment to the clubs on Friday, then another “as soon as the borrowed funds are collected, probably at the very end of October”. The deadline not paid by Mediapro was indeed to be paid on October 16 to the clubs, whose TV rights are the main source of income (36% for the L1 in 2018-2019 according to the DNCG, financial policeman of French football). Otherwise some might not be able to pay their players on time.
Scandal “
“There are obviously a number of clubs that can find themselves in great difficulty,” said Lyon president Jean-Michel Aulas on Wednesday, saying he was “worried”. And doubts about the financial seriousness of Mediapro continue to grow. The company, which had 727 million euros in debt at the end of 2019, saw the rating of its owner Joye Media downgraded by the agency Moody’s, to B3, which corresponds to a “high risk” of non-repayment or delay in loan repayments.
Read also PSG-OM: the moment of truth for the Téléfoot channel
Thursday, Marseille coach André Villas-Boas said he had “never seen that”. “I too dream of a millionaire’s house in Beverly Hills, but I’m not making a $ 20 million proposal. If you don’t have any money, don’t make a proposal for the rights of French football, it’s a scandal, ”the Portuguese lost his temper. According to Arnaud Rouger’s letter, Mediapro has initiated a mediation procedure with the Nanterre commercial court, which allows companies to negotiate with their creditors.
TV rights put up for auction?
Mediapro’s response in this procedure “was totally unacceptable in view of the financial uncertainties for the clubs”, details the executive director general. “Either a favorable outcome is found with Mediapro, or it is not the case, and it will be necessary to consider the resumption of the contract by other operators”, he threatens, while specifying to have activated in addition “the guarantee given by the parent company of the Mediapro group ”, the Chinese fund Orient Hontai Capital.
Read also Presidency of the LFP: Vincent Labrune, the phoenix of French football
“The current mediation blocks the use of the deposit”, nevertheless specified to Agence France-Presse a source close to the file. “The LFP is going through what many very small businesses (very small businesses, editor’s note) and SMEs experience in France, with a supplier who does not pay. In which case the TV rights could be put up for auction, with the risk of obtaining a significantly lower budget from Canal + or beIN Sports, the other major broadcasters in France. This could have cascading consequences for clubs, which have determined their payroll according to the contract with Mediapro and are already weakened by the drying up, health crisis requires, of ticketing revenues.
