FC Barcelona is planning to spin off and IPO its digital media interests into a new company on the Nasdaq exchange as part of an increasingly creative monetisation strategy.
The Spanish league club is in the initial stages of planning for this divestment, which could extract around US$200 million according to estimates.
It is reported, by Reuters, that the Barca Media vehicle would be 80% retained by the football club whilst the other 20% of the business would be held by the special purpose acquisition company (SPAC) on Nasdaq.
The report suggested that the stock market transaction would value the entire Barca Media business at around US$1 billion.
According to Reuters, the SPAC deal involves Swiss private equity fund Mountain Partners.
Pulling ‘levers’
The latest spin-out reports come a year after Barcelona ‘pulled multiple financial levers’ in order to squeeze inside the Spanish league’s financial fair play regulations – which prevent any new players from being registered to play if clubs exceed league-prescribed budgets.
Last year, the ‘financial levers’ pulled by Barcelona included the forward sale of 25% of its La Liga TV rights over a 25-year period to American investment firm Sixth Street.
It also sold 49% of Barca Studios, a separate media business spin-off, in separate deals with Orpheus Media and NFT firm Socios, netting just over US$200 million for the sales.
Meanwhile, in June 2022, an AGM gave Barcelona executives the authority to sell 49.9% of its retail interests in a vehicle known as Barça Licensing & Merchandising (BLM).
Debt and wages
On top of the ‘financial fair play’ restrictions, Barcelona is also heavily in debt (owing around €1.35 billion, with debt servicing costs of around €94 million per year).
It also carries one of European football’s most expensive wage bills with the club aiming to reduce it down to €450 million a year, from €530 million.
Barcelona has such high wages, in part, because to the inflationary force of having Leo Messi on the books for nearly two decades (up until his exit in 2021, the Argentina striker was reportedly paid in excess of €1 million per week).
Meanwhile, media reports last year claimed former club captain Gerard Pique was owed €50 million in unpaid salary, due to deferred wages during Covid.
Other high-profile players such as Sergio Busquets and Frenkie De Jong are believed to also be owed back pay, meanwhile, the club also owes significant fees relating to past transfer deals.
Who owns Barcelona?
Barcelona’s complex organisational structure comes as the club, which is steeped in Catalan culture and politics, attempts to balance its heritage and position as one of the world’s most iconic and valuable sports brands.
Technically, FC Barcelona is a ‘fan-owned’ not-for-profit organisation run by elected officers on behalf of the community.
This ownership system sees the club held by members, known as Socis (in Catalan) or Socios (in Spanish), though this is not an open group of fans.
New members are required to meet some strict conditions including showing familial ties to existing members or by completing a three-year ‘commitment’ process (costing nearly €1,500 per member).
Socis vote in club elections to appoint key club officials, including the club president who essentially acts as its chief executive. Only fully paid-up Socis are eligible for Barcelona season tickets, which have a ten-year waiting list.
Other business units associated with the football club, like Barca Media, Barca Studios or Barça Licensing & Merchandising, for example, are distinct commercial entities that can be monetised and owned by third-part investment companies.