Seven Italian Serie A soccer clubs no longer see the sale of a stake in the league's media business to a private equity consortium as a viable option, a document showed on Tuesday, effectively blocking the $2 billion deal.
Serie A agreed in October to enter exclusive talks with a consortium including CVC Capital Partners, Advent International and Italian fund FSI, which offered 1.7 billion euros ($2 billion) for a 10% stake in a newly-created unit managing the Italian league's media business.
The deal needs the approval of at least 14 of the 20 top-flight clubs to proceed so a rejection by seven of the teams, who include champions Juventus, would be enough to halt it.
Under pressure to cope with a sharp decline in revenues caused by empty stadiums during the COVID-19 pandemic, Serie A clubs had been looking to the deal as a way to raise fresh funds.
But some clubs had reservations and a final decision on the accord, expected earlier this month, had to be postponed.
"The term sheet submitted to the clubs belonging to the league has not reached a qualified consensus needed for the approval ... as things stand, this development opportunity is not viable anymore", seven clubs, including SS Lazio and Inter Milan, wrote in a letter addressed to the league's President Paolo Dal Pino and seen by Reuters.
The clubs said a better than expected response to a tender to award Serie A's domestic TV rights in talks with prospective buyers provided arguments against the stake sale.
They said the talks with broadcasters had confirmed the significant appeal of Italian soccer and had proven a "commercial success" with projected proceeds set to decline less than feared.
In the letter the seven clubs requested a vote at a meeting on Wednesday on the sale of Serie A's domestic TV rights for the 2021-2024 seasons.
But two sources familiar with the matter said eights clubs that look favourably upon the private equity deal intend to boycott the meeting, making a decision impossible.
Sports streaming service DAZN is leading the race in a challenge to the country's dominant pay-TV player SKY, with an offer worth 850 million euros per season, sources have said.
Serie A could raise slightly more than 900 million euros by combining DAZN's bid with an offer by SKY to screen some matches on its streaming platform, according to the sources.
The clubs also said in the letter they did not rule out talks with "financial institutions" to increase the League's business value on international markets, signalling they could consider a deal like the one discussed with the private equity firms for the league's overseas media rights.
(Reporting by Elvira Pollina; Editing by Keith Weir and Ken Ferris)
