Spanish football giant FC Barcelona, fresh off a La Liga championship win last year, is gearing up to take on the US financial markets through a US$1 billion reverse merger.
The club has formally agreed to list its content creation arm Barca Media on the Nasdaq through a merger with special purpose acquisition company (SPAC) Mountain Partners, a Swiss-based entity.
Barca Media, which oversees the club's vast digital media assets, including video content, esports, and a social media following of 421 million globally, is seeking “a gateway to the US capital markets, setting the stage for an even more robust platform to expedite its diverse growth strategy," the club mentioned in a statement.
The anticipated merger is set to conclude in the fourth quarter, after which Barca Media will trade under the ticker "BRME". Existing shareholders of Barca Media are slated to retain a dominant 80% stake in the company.
Joan Laporta, FC Barcelona's president, inherited a club grappling with financial woes when he took the post in 2021.
Exacerbated by the COVID-19 pandemic and the unexpected departure of Argentine legend Lionel Messi in 2021, Laporta has been given the task of turning Europe’s most debt-laden club around.
In 2022, Barcelona advanced the sale of a quarter of its LaLiga TV rights spanning 25 years to the US investment company, Sixth Street.
Additionally, the club divested 49% of Barca Studios, its distinct media business offshoot, through individual transactions with Orpheus Media and the NFT enterprise Socios, collectively bringing in slightly above US$200 million.
In June 2022, a general meeting granted Barcelona's leadership the permission to offload up to 49.9% of its retail assets under the banner of Barça Licensing & Merchandising (BLM).
A SPAC, or blank-cheque company, is a publicly listed entity that merges with a private company to make it easier for a company, in this case Barca Media, to tap the public markets.
Though SPAC deals make it easier to raise capital, their long-term success is questionable.
Following a record year for SPAC deals in 2021, the reverse merger market has bottomed out amid plummeting share prices and investor returns.