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Police on Tuesday searched the offices of the French football league in Paris and private equity firm CVC Capital Partners as part of an investigation into potential corruption, according to an official in the judiciary.
French financial prosecutors are examining allegations of corruption and embezzlement of public funds linked to the deal struck between Ligue de Football Professionnel, which operates the top two tiers of French football, and CVC to create a subsidiary to commercialise the broadcasting rights for French top flight football games.
In 2022, CVC invested €1.5bn to acquire a 13 per cent stake in the new vehicle with the promise to the LFP that their expertise in sports marketing and international markets would help increase revenues significantly. The contract called for it to last 99 years, and for CVC to be entitled to long-term dividends.
LFP turned to CVC, which has invested in sports ranging from Formula One car racing to rugby and volleyball, to help solve grave financial problems that arose because of the Covid-19 pandemic and the collapse of its then broadcast partnership. But two years since the CVC deal, French clubs are still struggling because of a decline in the value of the media rights at home.
LFP head Vincent Labrune and the LFP have struggled to find a reliable media partner to broadcast matches even in France, where the league should be the most popular. Revenue from TV rights fell 35 per cent this year compared with last, with the current broadcasters DAZN and beIN Sports paying less than €500mn a year — well below the €1bn originally targeted by LFP.
Top-flight football in France is the fifth-largest league in terms of revenue behind England, Germany, Italy and Spain, but its competition remains dominated by the superclub Paris Saint-Germain with smaller clubs struggling to keep pace.
The raids were first reported by L’Équipe sports newspaper, which also said that the home of Labrune was searched.
No charges have yet been brought, and preliminary investigations in France do not necessarily mean there will be a trial.
LFP said it “is cooperating with the judiciary to provide all necessary information for the ongoing investigation with complete transparency”. It added: “The investigative actions, carried out in a calm and orderly manner, will confirm that the Ligue’s efforts have always been guided by a deep commitment to French football, fully respecting the rules in place.”
CVC declined to comment.
The case was sparked by a complaint filed by an advocacy group called AC!! Anti-Corruption in 2023.
The French Senate has also been examining the LFP-CVC deal in a commission inquiry. Senators Laurent Lafon and Michel Savin wrote in their findings released last week that the €37mn in commissions to investment bankers and lawyers who worked on the deal seemed too high, while Labrune’s bonus of €3mn “posed a question over conflicts of interest”.
They added: “Indeed, while the long-term benefit of the deal with CVC remains to be demonstrated for the clubs, given the lifetime dividend payment, its appeal for the LFP’s leaders is, on the other hand, clear, immediate, and without future obligations.”
LFP’s struggles go back to an ill-fated decision in 2018 to sell the bulk of its media rights to Spanish group Mediapro for a record €800mn a year from 2020 to 2024 rather than continue with long-standing partner Canal+. However, Mediapro stopped paying LFP when the pandemic hit, leaving the league and its clubs without a vital revenue stream.
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