Thursday briefing: New UEFA/ECA agreement deals blow to nascent club union
Thursday briefing: New UEFA/ECA agreement deals blow to nascent club union
IMAGO
UEFA approves €1.4 billion three-year solidarity deal
Manchester United share price drops 18.2 per cent after report claims Glazers will take club off market
Mediapro president Jaume Roures: LFP target of €1 billion per year for next media rights cycle ‘not possible’
Chelsea ‘pitched shirt sponsorship deal’ to Saudi airline Riyadh Air
7 September 2023 - 4:30 AM
Berlin: UEFA and the European Club Association (ECA) have renewed their memorandum of understanding (MOU), extending the partnership between the European governing body and ECA until 2030.
The agreement was signed by UEFA president Alexander Čeferin and ECA chairman, Nasser al Khelaifi, on the sidelines at the ECA’s biannual General Assembly yesterday in the German capital.
The MOU deals a blow to the nascent Union of European Clubs (UEC), a rival body launched on a one member one vote platform earlier this year as it says that UEFA will continue to recognise ECA as “the sole body representative of clubs at European level”.
ECA said in a statement that the agreement “further strengthens” the relationship between ECA and UEFA. ECA claims membership of almost 500 clubs, although only around half of those clubs were in attendance in Berlin, and less than a quarter have full voting rights.
Al Khelaifi, in his address to the General Assembly, listed a number of achievements the two bodies he says have jointly attained over the duration of the current deal.
Healthy growth
Under the terms of the new MoU, ECA’s representation in UEFA bodies will be maintained in existing committees and be further extended to various new ones.
Čeferin said that the relationship between UEFA and the ECA would bring “continuity, stability and healthy growth that will benefit every corner of Europe.”
UEC said in a statement that it was “very concerned” that European football “has not developed on the basis of an adequate governance model”. It said that its one club, one vote platform was the “very basic principle of democracy”.
It also emerged that the Belgian club Union Saint-Gilloise were blocked from renewing their ECA membership after signing up to UEC.
UEFA approves €1.4 billion three-year solidarity deal
Berlin: UEFA has agreed to increase solidarity payments to clubs that don’t compete in its club competitions in a deal that could be worth nearly half a billion euros each season over the next three years.
The deal will see a total of around 10 per cent of UEFA Club competition (UCC) revenues for the broadcast cycle that begins next year given to non-competing clubs, up from 7 per cent in the existing cycle.
UEFA is targeting broadcast deals worth €4.8 billion annually from 2024/25 when its new broadcast cycle starts.
The solidarity payments consist of 3 per cent payable to clubs that fall in qualifying rounds for UEFA competitions and 7 per cent to those that don’t partake at all. The solidarity money is distributed by league bodies across Europe according to their own formulas. Until the end of this season non-competing clubs take 4 per cent of the broadcast pie.
"Unbalanced model"
The deal follows lobbying by the European Leagues, an influential body that represents 35 professional leagues across Europe, to increase the share to 10 per cent for non-competing clubs.
In 2021/22, the last season for which data is available, non-qualifying clubs shared €171.8 million between them (4.75 per cent), while those that played in European Club Competition shared €2.732 billion (75.6 per cent).
In a research paper it produced earlier this year European Leagues argued that current prize distributions provided an “unbalanced model” in which the financial gap between participating clubs and non-participating clubs has “been growing constantly, causing a mounting distorting effect on domestic competitive balance.”
Following the approved solidarity deal, the Union of European Clubs (UEC) has issued a statement in which it "welcomes the announcement by UEFA to adjust the criteria and current model of revenue distribution from UEFA Club Competitions starting in 2024/25."
Manchester United share price drops 18.2 per cent after report claims Glazers will take club off market
Manchester United’s share price has fallen by a record amount amid speculation that the Glazer family are planning to halt their attempts to sell the club.
Shares in United, which are listed on the New York Stock Exchange, fell from $23.66 when trading closed on Friday ahead of the Labor Day weekend, to $18.83 when trading resumed on Tuesday, before recovering slightly to close at $19.35.
The price dropped back once again in morning trading on Wednesday, and was $19.16 at 1pm New York time.
The fall on Tuesday represented a drop of 18.2 per cent – the biggest decline in the share price since the club was floated in 2012. The previous biggest fall came in March 2020, when shares dropped by 14 per cent as the Covid-19 pandemic shut down global sport.
The cause of Tuesday’s drop in value, which saw United’s market capitalisation decline by almost $700 million, is widely viewed as being a report in The Mail on Sunday published over the weekend which claimed the Glazers are not going to sell United.
Doubled in a week
When the club was put up for sale last November, United’s share price almost doubled in a week from the $12-14 range it had been trading in for most of 2022, to more than $22.
The Glazers had initially hoped to attract multiple serious bidders but only two emerged: Sheik Jassim of Qatar, who wanted to acquire the entire club, and British billionaire Sir Jim Ratcliffe, whose offer would have left the American family with a minority stake.
The Mail on Sunday reported that the Glazers plan to put the club back up for sale in 2025 when they believe their valuation of £7-10 billion will be met.
Mediapro president Jaume Roures: LFP target of €1 billion per year for next media rights cycle ‘not possible’
Mediapro president Jaume Roures has dismissed the chances of France’s Professional Football League (LFP) earning €1 billion per year from its domestic and international media rights in the next cycle, which runs from 2024/25.
LFP president Vincent Labrune has previously claimed the €1 billion figure is achievable for the new cycle, which runs from 2024/25, despite the “macroeconomic and financial context” being “delicate”.
However, in an interview with RMC Sport ahead of the launch of the rights auction next Tuesday, 12th September, Roures said: “No, I don’t think that’s [€1 billion] possible. The market situation is difficult. We must also look at the economic situation and the role of Ligue 1 among the European leagues.”
He added: “We could see in Italy with the call for tenders, where they asked for a little over a billion and they did not achieve this result. The process is still ongoing. The sports rights market is still in a difficult situation.”
The LFP is targeting €863.7 million per year from domestic rights in the new cycle, up 30 per cent on the €662.6 million earned at present, and €200 million per year from international rights, compared with an average of €80 million per season for the current cycle.
Roures argued that the international target is “far from realistic” given the departure of high-profile players such as Lionel Messi and Neymar from Ligue 1 this summer.
Collapse of €3.3 billion deal
The Mediapro president was speaking less than three years after the collapse of his company’s €3.3 billion deal with the LFP, which plunged French football into a crisis it is yet to recover from.
Roures confirmed Mediapro would not be submitting an offer in the latest tender, but said “France is not finished for us as a business”, hinting at potential production and media rights sales roles it has elsewhere in Europe.
Chelsea ‘pitched shirt sponsorship deal’ to Saudi airline Riyadh Air
Chelsea executives have held talks with representatives from Saudi state airline Riyadh Air about a potential front-of-shirt sponsorship deal, according to a report from The Athletic.
CEO Chris Jurasek was among a number of Chelsea officials who hosted a Riyadh Air delegation at Stamford Bridge for Saturday’s 1-0 defeat to Nottingham Forest. It is understood the club then pitched to the airline about a multi-year sponsorship deal for the men’s and women’s teams.
Riyadh Air, which already sponsors Atletico Madrid, is owned by Saudi Arabia’s Public Investment Fund (PIF). The Crown Prince Mohammed bin Salman announced the formation of the new airline in March, which has still not flown a plane and does not plan to do so until 2025.
Chelsea’s shirts have been blank so far this season as the club attempts to replace mobile network Three. There have been negotiations with sports data company Infinite Athlete, but the deal is still awaiting approval from the Premier League.
Betting website also a contender
Another contender to be the Chelsea front-of-shirt sponsor is believed to be the betting website Kaiyun Sports, which announced a deal with Nottingham Forest last week.
Kaiyun Sports appears to target customers in China – where gambling is illegal – and accesses the UK market via a “white label” agreement with a company on the Isle of Man. It is unclear what country Kaiyun is based in or who its owners are, which is extremely unusual for a sponsorship deal of this prominence.
Chelsea are reassured, however, by the fact Kaiyun have existing deals with Real Madrid, Crystal Palace and Inter Milan, while the betting firm already has a partnership deal with Chelsea and was displayed on the billboards at Stamford Bridge on Saturday.