French football, at risk of bankruptcy due to Mediapro defaults

The french soccer fear catastrophe. It is now close to financial asphyxia. The Mediapro group, which holds the audiovisual rights of Ligue 1 and Ligue 2, failed this Saturday, for the second time, the obligation to pay the money promised for this season. The amount in arrears now amounts to 334 million euros. If an agreement is not reached soon in the ongoing negotiation through a judicial mediator, some clubs could declare themselves in suspension of payments or in simple bankruptcy.

The newspaper The Parisian -the most widely read in the French capital- on Saturday dedicated its main cover story, two inside pages and the editorial to the delicate financial situation of the Professional Football League (LFP). “French football, on the verge of bankruptcy,” he titled. Other media have dealt with the issue profusely in recent weeks. Although they always insist that Mediapro is a Spanish-Chinese group, they have focused on its founder, Jaume Roures, often referred to as “the Catalan.” The world He recently published a profile in which he alluded to his political past and defined him as “the Catalan Trotskyist on whom the future of Ligue 1 depends.”

In ‘The World’

In France, Jaume Roures has been defined as “the Catalan Trotskyist on whom the future of Ligue 1 depends”

Mediapro signed a contract in which it undertook to pay the LFP a total of 814 million euros per year during the period 2020-2024. The problem is that, with the coronavirus crisis, the accounts have not come out. Mediapro created a new channel, Telefoot, for which it expected to attract 3.5 million subscribers. The latest figures indicate that only 600,000 have been reached.

Faced with this situation, Mediapro missed the first payment term for this year and asked to renegotiate the contract downwards due to the special circumstances of the championship. The LFP and the clubs shouted to heaven but accepted the dialogue. After the second deadline expired, the mediator proposed by the court in Nanterre, west of Paris, indicated that an additional deadline has been set to continue negotiations.

The LFP is in a hurry because it must repay a loan guaranteed by the State, worth 224.5 million euros, contracted last spring, during the first lockdown. Unlike in other countries, in France the championship was ended and was never resumed, leading to much discontent and heavy losses.

Limit situation

The LFP is in a hurry because it must repay a loan guaranteed by the State, worth 224.5 million euros, contracted last spring

First division clubs are highly dependent on television rights. For some, such as Nîmes, they account for 76.2% of income. Those with the least dependency are Marseille (46.2%), PSG (23.8%) and Lyon (21.8%). There is talk that Canal +, the historical audiovisual partner of the LFP, could relieve Mediapro if this group ends up resigning, but it is obvious that, in that case, Canal + will negotiate very low.

The brutal burst of the television rights bubble was something that some analysts already saw coming, even before the outbreak of the Covid-19 pandemic. If this scenario materializes, it will lead many French clubs to severe belt tightening and shed their highest paid stars, which in turn will make the championship less attractive to international audiences. The horizon, today, is gloomy.

PORTADA THE PARISIAN

Cover of Le Parisien for Saturday 5 December 2020

The Parisian

Source: Portada by www.lavanguardia.com.

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