CVC’s biggest bet yet
When plans for a money-spinning “Super League” of Europe’s top football clubs collapsed in a furious outcry last year, billionaire tycoons were forced into grovelling public apologies. But behind closed doors, Europe’s largest private equity firm had long since walked away, write Kaye Wiggins and Arash Massoudi.
CVC Capital Partners abandoned the project after early-stage talks about a possible investment. Then, after its collapse, the buyout firm stepped up to buy a stake in La Liga, Spain’s football league, for €2.1bn, giving it a share of broadcasting and commercial revenues for up to half a century.
If those revenues keep growing at present rates, CVC could treble or even quadruple its money in the next decade. Since the league is not on the hook for clubs’ costs, the vast majority of CVC’s revenue is profit.
“It’s the best deal in the history of private equity”, a rival football dealmaker says. “They are not going to lose money here.”
CVC has made tens of billions of euros buying stakes in household-name brands from Debenhams to Formula One to the maker of PG Tips tea, all while remaining largely hidden from public view.
Now, almost three decades since it spun out of Citibank’s London office, the 700-person firm with €133bn in assets is at a crossroads. By the beginning of this year, its top executives had finally decided to take the firm public.
That would bring it into line with its larger rivals, such as Blackstone, KKR, and Carlyle; allow it to stay ahead of European competitors like EQT, which has grown rapidly since listing in 2019; and permit the founders who still oversee the firm to eventually cash in their stakes.
But it would also attract a level of scrutiny that it is not used to, and risks watering down the high-risk, high-reward model that is fundamental to CVC’s culture — reducing its rainmaker executives to a smaller part of a sprawling institution.
CVC’s listing will test whether one of Europe’s oldest buyout groups can modernise. Don’t miss don’t this in-depth account of the company at a pivotal moment in the history of both it and the private equity industry.