BLACKSTONE has dropped out of the bidding for a controversial football media rights deal in Germany, according to sources familiar with the matter, following a backlash from fans critical of foreign capital.
The buyout firm abandoned its pursuit amid concerns about how long a deal could take to come to fruition, according to the sources. Structuring and economic factors also made it hard for Blackstone to see how to make a transaction work, the sources said, asking not to be identified because the information is private.
The move follows news reports that some clubs want a fresh vote on the proposal, potentially dragging out what’s already been a contentious process.
Blackstone’s departure leaves CVC Capital Partners, which has a stake in the media interests of the French and Spanish elite football leagues, as the sole remaining bidder. CVC is still committed to pursuing a potential deal, the sources said.
Representatives for Blackstone and CVC declined to comment. A representative for Deutsche Fussball Liga (DFL), German professional football’s governing body, had no immediate comment.
Blackstone’s decision comes after a ramping up of protests against private equity involvement in the sport’s top league, the Bundesliga, at the weekend. Many matches, including the top clash between Bayern Munich and Bayer Leverkusen, were delayed as fans threw sweets and bouncy balls onto the pitch.
The game between Hamburger SV and Hannover 96 was interrupted after Hannover fans showed a banner of Martin Kind, the club’s managing director, behind a crosshairs, according to the publication sportschau.de.
The publication Spiegel Sport last weekend criticised Blackstone chairman Stephen Schwarzman, observing that in 2010, he compared planned tax increases by president Barack Obama with Adolf Hitler’s invasion of Poland. Schwarzman apologised for the analogy at the time, while maintaining his criticism of the tax proposal.
Bloomberg News first reported in November that DFL was starting a third attempt to raise external capital. The league abandoned an earlier process after opposition from fans and teams.
Buyout firms including Blackstone, CVC and EQT in December submitted bids for a minority stake in the company that holds broadcasting rights for the country’s top football leagues. DFL last month chose Blackstone and CVC as the final bidders.
The plan is to help the league digitise its content and secure more profitable rights deals both in Germany and globally, in an effort to catch up or keep up with the commercially more successful English Premier League.
Even though clubs voted in favour of the deal in December, fan groups have been vehemently opposed, with some of them criticising the firms for taking funds from Saudi Arabia. In the past few weeks, some fans have suggested that the outcome was skewed by the actions of Hannover’s Kind voting in favour when his club members had called on him to vote against.
Claus Vogt, president of VfB Stuttgart, last week called for a “renewed, transparent” vote on the entry of an investor. BLOOMBERG