Status: 11/16/2022 2:04 p.m

    On Thursday, the 36 German professional clubs come to the DFL general meeting. There it should also be about the sale of shares in the Bundesliga to investors. DFL boss Donata Hopfen is therefore under pressure

    The Bundesliga is on pause, all eyes are on the World Cup in Qatar – but the German Football League has a groundbreaking general meeting of the 36 professional clubs on Thursday (17.12.22). A possible sale of shares in the DFL is likely to be controversial.

    “Donata Hopfen has lost support”

    It is about the entry of private equity investors into the Bundesliga and a partial sale of the media rights. Manager Magazin already wrote about one in October “stress test” for DFL Managing Director Donata Hopfen, who is under pressure. “If she fails, she is threatened with the end”, the authors claimed. A long-time Bundesliga manager now confirms the Sportschau: “Hops wobble, she has lost a lot of support.”

    The sports show has received a letter from the DFL boss dated October 17th to the clubs, in which she is asking for support with a view to the upcoming meeting – in order to get fresh money quickly with the help of the clubs. In the letter to the board members and managing directors of all first and second division clubs, she emphasizes that the DFL, as a league association, is responsible “To create optimal conditions in order to be socially relevant, sportingly attractive and economically competitive”.

    Hopfen points to enormous challenges due to changed media usage behavior, changed rights purchasing behavior by media companies, including one “intense global competition with other top leagues”. In plain language: The Bundesliga, recently with declining media revenues (now 1.1 billion euros per season), is in danger of being left behind internationally.

    Financial injection from abroad?

    Their desired way out: the participation of an investor in the national and international media rights. The leagues in France and Spain had recently gone this way with an investor from Luxembourg (CVC Capital Partners) – and had thereby redeemed billions. In return for a cash injection of 2.7 billion euros, the investor will collect eleven percent of all TV revenues in Spain’s first and second divisions over the next 50 years.

    The DFL would also like to get between three and four billion euros from an investordeal redeem. To this end, the association would bundle its marketing rights and set up a new subsidiary, the value of which, according to Manager Magazin, would be estimated at 15 to 18 billion. So it would be about a share sale of up to 20 percent.

    The DFL has a lot of room for improvement, especially in international marketing. By way of comparison: While the Bundesliga generated just around 170 million euros this season, the premier league finalized new deals that should secure her $6.28 billion over the next three years. Fernando Carro, managing director of Bayer Leverkusen, had already criticized on the fringes of the general assembly in August that the Bundesliga had undersold itself.

    Disagreement between hops and the clubs

    However, the DFL has a problem: International contracts that expire next year and can therefore be renegotiated currently have a volume of just twelve million euros. “Hop has only limited scope and is desperately looking for new ways, sees the sale of shares as a quick way out”according to the former Bundesliga manager: “You can be driven in one direction in the search for new sources of income. But many clubs reject this anticipation of the silverware.”

    On the one hand, because many have had bad experiences themselves pledging their own rights; on the other hand, because the entry of an investor would deter other potential financiers. The market would be narrowed. Industry example FC Bayern: The participation of Adidas in the club ensures that a company like Nike cannot invest in the first place.

    The first reaction of the clubs to the DFL General Assembly was also predominantly negative. “I don’t believe in just pumping more money into circulation and spending one-on-one”said Alexander Wehrle, CEO of VfB Stuttgart, at the time.

    The big problem, from the point of view of many clubs: it is still unclear how the fresh money would be distributed – and what it would be used for. “Many see the danger that it will only end up back in the pockets of players and their agents”the still well-connected former manager says to the sports show: “And new distribution battles are looming.”

    Many are demanding a clear commitment that the money will be used sustainably. For example, to support smaller clubs in terms of infrastructure or youth development – to close the financial gap to the big clubs, which can cash in in international competitions.

    First talks have been held

    In her letter, Hopfen cautiously approaches the clubs. “You alone decide that as the General Assembly of the DFL”she writes, it’s about one “strategic partnership that could bring growth capital and know-how in future fields for the league and clubs”.

    According to Hopfen, this process has been carried out very intensively for weeks and accompanied by expert partners such as Deutsche Bank and the Japanese investment bank Nomura. One has already, so hops, “First informal discussions held with selected interested parties”. The DFL had set up its own five-person working group for this purpose, which included not only hops but also Rüdiger Fritsch (Darmstadt), Jan-Christian Dreesen (FC Bayern), Axel Hellmann (Eintracht Frankfurt) and Oliver Leki (SC Freiburg).

    Among the allegedly eight interested parties in the shares, some of whose names leaked weeks ago in the specialist magazine Kicker, there are several private equity-Companies like CVC from Luxembourg and Liberty Media from the USA whose business area also includes the media industry.

    According to well-informed circles among the DFL clubs, however, there is a discussion here: Why set up a streaming platform with an investor? Can’t we do it all ourselves without giving anything away? In other words: an investment in your own technology, your own streaming service, your own TV station? It is said that more innovation is expected from Donata Hops. However, the risk would then lie solely with the league.

    According to Hopfen, Thursday is about one “Update to current status”. Insiders are not yet expecting a decision. According to the manager, nobody wants to be taken by surprise in the shadow of the dominant topic of the Qatar World Cup, “Even if Ms. Hopfen is under enormous pressure to finally have to deliver something, the league can’t just be about making quick money”.

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