Valencia CF to use CVC funds for new venue

Image: Valencia CF

The Spanish professional football club Valencia CF (LaLiga) will allocate 80 of the 127 million that correspond to the League agreement with the private equity firm CVC to its new stadium – Estadi Nou Mestalla – in Valencia, Spain.

The ‘Today.in-24’ stated that the above revelation was made by the Valencia CF President, Anil Murthy, and its Financial Director, Inma Ibáñez, at the club’s shareholders’ meeting held recently.

As part of a deal struck in August 2021, Spain’s top flights (LaLiga clubs) would get lucrative cash infusions under a proposed 2.7 billion euros ($3.2 billion) deal between the country’s top league and CVC. Clubs will have to utilize major part of the money (70 percent) on infrastructure upgrade, such as use of cutting-edge technology. The rest of the amount can be used on player acquisition (15 percent) and a further 15 percent to finance debts.

LaLiga said last year that it had agreed in principle to a “multipronged” deal with CVC including the 2.7 billion euros infusion in return for 10 percent of its revenue, as well as the creation of a newly formed company housing a range of commercial activities in which CVC would also take a 10 percent stake.

LaLiga is the men’s top professional football division of the Spanish football league system.

CVC Capital Partners is a private equity and investment advisory firm with approximately US$111 billion in secured commitments since inception across European and Asian private equity, credit and growth funds.

Valencia Club de Fútbol, commonly referred to as Valencia CF or simply Valencia, is a Spanish professional football club in Valencia that currently plays in LaLiga, the top flight of Spanish football. Valencia has won six LaLiga titles, eight Copa del Rey titles, one Supercopa de España, and one Copa Eva Duarte. In European competitions, they have won two Inter-Cities Fairs Cups, one Union of European Football Associations (UEFA Cup), one UEFA Cup Winners’ Cup, two UEFA Super Cups, and one UEFA Intertoto Cup.

The Mestalla Stadium is a football stadium in Valencia, Spain. The stadium is the home of Valencia CF and has a capacity of 48,600 seats, making it the eighth-largest stadium in Spain, and the largest in the Valencian community. The North Stand of the stadium is known for its very steep section.

The Estadi Nou Mestalla is a partially-built 54,000-seat football stadium in Valencia, Spain, intended as a replacement for Valencia CF’s current stadium, Mestalla Stadium. The basic concrete structure of the stadium was built between August 2007 and February 2009, but work was then halted due to financial reasons.

The ‘Today.in-24’ further stated that the above announcement does not mean that the investment to be made to finish the work of the partially-constructed stadium is only 80 million. The amount for the completion of the stadium will be higher, although the club has not reported either the total or how it will be financed.

Murthy is waiting for the President of the Generalitat Valenciana, Ximo Puig, to set the date and time for the meeting requested by Valencia after signing the agreement with CVC. It will be on that date that Murthy will present the work and financing terms. What the President has set is a possible resumption date: September 2022, although he has clarified that everything is pending due to red tapism.

Ibáñez pointed out that 15 percent of the 127 million will go to paying debts incurred due to the pandemic – the Omicron variant of which is again throttling the world – and another 15 percent will go for the incorporation of soccer players. That is, 19 million, respectively. The remaining four million will be spent on digitization and branding.

The Generalitat Valenciana is the generic name covering the different self-Government institutions under which the Spanish autonomous community of Valencia is politically organized. It consists of seven institutions including the Corts Valencianes, the President of the Generalitat, or the autonomous Government itself.

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