No takers for French club Les Girondins

Image: Herzog de Meuron

The French Ligue 1 side Girondins de Bordeaux (France) is up for grabs with the US private equity investor King Street taking the above decision as the club is facing a lot of financial heat due to the COVID-19 situation which is bleeding white the sports venue sector globally.

‘INSIDE WORLD FOOTBALL’ stated that Bordeaux CEO Frédéric Longuépée recently informed the club’s employees of a plan to safeguard jobs in the wake of an €80 million hole in the club’s accounts. Even before coronavirus bared its fangs on the world in March 2020, the financial health of Bordeaux was nothing to write home about with the club reporting losses year on year, with pre-tax losses of €61.4 million in the three seasons leading up to the 2018-2019 seasons.

Girondins de Bordeaux or simply Bordeaux is a French professional football club based in the City of Bordeaux in Gironde, Nouvelle-Aquitaine (France). The club currently play in Ligue 1, the top division of French football.

The 42,115-capacity Nouveau Stade de Bordeaux, currently also known as the Matmut Atlantique for sponsorship purposes, is a football stadium in Bordeaux, France. It is the home of Ligue 1 club FC Girondins de Bordeaux.

‘INSIDE WORLD FOOTBALL’ further stated that in 2018, global investment firm King Street picked up majority stake in the club as part of a €95 million takeover with US investor Joseph DaGrosa’s GACP Sports, before going on to become the sole owner in 2019.

GACP Sports is the sports investment arm of General American Capital Partners LLC (‘GACP’), a private equity firm based in Miami, Florida (US). GACP Sports is focused on making control and influential minority investments in sports-related assets located throughout the United States and Western Europe.

Last year, €27.5 million was injected into the club to meet the requirements of the Ligue de Football Professionnel (LFP’s) financial regulations, but the club’s fiscal health has not improved with matchday revenue getting erased due to the coronavirus scourge and the TV rights flop that has decimated French football.

Filing for bankruptcy could be an alternative avenue. It would come with the triple advantage of paying off the debt, cleaning up the accounts to make the club more attractive to buyers and would not lead to enforcing relegation on the club, according to a decision arrived at by the French Football Federation (FFF) Executive Committee on November 12^th,2020. However, it would require a bankruptcy filing and recovery plan before the start of the 2021-2022 seasons which is all slated to start on August 7^th, 2021 and will end on May 21^st, 2022.

The Ligue de Football Professionnel, commonly known as the LFP, is a French governing body that runs the major professional football leagues in France. It was founded in 1944 and serves under the authority of the French Football Federation.
 

Whopping amount

‘Get French Football News’ stated that Businessman Bruno Fiévet had evinced interest in buying the club and he explained his attempts to lead a consortium of investors in buying Ligue 1 club Bordeaux from American fund King Street and that the current owners are seeking a whopping €260m package in order to sell the club, for which he has pulled back.

‘Get French Football News’ quoted Fiévet as stating, “In order to contextualise things, we made a first approach in February 2020 which was not followed up, without a response from King Street. I thought the timing was right for them as they had just inherited a club that they didn’t want. We inquired and worked on an offer that could make them consider. In September, we made a substantial offer of roughly €70m, a price we were prepared to commit to. You should know that at that time, TV rights were not the house of cards that has since collapsed. The stadiums weren’t confirmed as without fans either yet, the club was still worth that price. Today, it is clearly not worth that, hence the ever-increasing deficit which will continue to exist next year. It should be noted that the owners are putting their hands in their pocket to financially save this club, despite everything, it remains a slow agony. We made a coherent offer in a still favorable context.”

Added Fiévet, “Today, we are forced to say to ourselves that we cannot buy back Bordeaux. King Street wants at least €100m, there is €80m deficit, €56m in debts to financier Fortress which will have to be repaid by October 2022 that’s already €236m and you won’t yet have done anything to restructure the club at that point. In the state in which it is, there is much restructuring to be done, of players and staff and then you have to buy new players. It takes a minimum of €30m-€40m to buy a few valuable players.”

He concluded by stating, “Today, the entry ticket is €260m to try to do something, I do not have that. First of all, I, Bruno Fiévet, I do not have that money because I am not a Qatari prince or an investment fund. But the investors I represent are also not ready to put €260m on the table to buy the Girondins de Bordeaux and nobody is ready to do so.”

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