**FC Barcelona Plans SPAC Listing for Barca Media**
Spanish football club FC Barcelona aims to address its financial troubles by listing its content creation unit, Barca Media, on Nasdaq through a special purpose acquisition company (SPAC) merger. The club hopes to secure funding to create additional sources of income, with Barca Media expected to become a significant revenue contributor in the future. The SPAC involved in the listing is Swiss private equity fund Mountain Partners, with current Barca Media shareholders set to retain an 80% stake in the company.
**FC Barcelona Tackles Financial Challenges**
FC Barcelona’s decision to pursue a SPAC listing comes at a time when the club is grappling with the aftermath of a financial meltdown caused by mounting debt and poor management. In 2021, the club recorded a loss of €481 million ($527 million) and its debt continued to rise. This financial strain impacted the players, some of whom agreed to pay cuts in order to help the club recruit new team members. The effects of the pandemic further exacerbated the club’s difficulties, as revenue declined due to fewer games. As a result, FC Barcelona was unable to renew the contract of its star player, Lionel Messi, citing financial obstacles.
**Joan Laporta’s Return and Unorthodox Measures**
In March 2021, FC Barcelona underwent a management change when former president Joan Laporta returned as the leader. Laporta’s key focus during his second tenure was to rectify the club’s financial situation. To achieve this, he orchestrated a series of unconventional deals involving mortgaging future income in exchange for immediate cash injections. In June 2022, he sold a 25% stake in future media rights deals to Sixth Street Capital for a minimum of $317 million. The following month, Laporta sold two 24.5% stakes in Barca Studios, the club’s content division, to blockchain company socios.com and Orpheus Media, headed by Catalan media figure Juanme Roures, for $103 million (100 million euros) each.
**Exploring Barcelona’s Financial Journey**
While FC Barcelona boasted revenue exceeding $1 billion in the 2018-19 season, making history as the first sports team to achieve this milestone, the club experienced escalating costs as its income stagnated. The pandemic further exacerbated their financial woes, causing revenue to plummet. The club is banking on a $1.6 billion stadium renovation, complete with various entertainment and shopping options, to generate new revenue and restore its status as a financial powerhouse. Reuters estimates that the new stadium will deliver an additional $219 million in revenue through various events, ticket sales, and more.
**The Rise of SPACs and FC Barcelona’s Endeavor**
In recent years, SPACs have evolved from being viewed as unconventional on Wall Street to becoming a popular alternative to traditional initial public offerings. Numerous technology and finance companies, including DraftKings, WeWork, and Nikola, have opted for SPAC listings to expedite the process of going public. However, when the stock market experienced a downturn in 2022, many SPACs encountered difficulties. FC Barcelona’s foray into the SPAC arena isn’t unprecedented in the football world. In January, the owners of French team Olympique Lyonnais expressed their intention to explore a potential SPAC listing in the US, though no action has been taken thus far.
**Barca Media Update and Change of Ownership**
In conjunction with the SPAC deal involving Mountain Partners, FC Barcelona also announced changes in the ownership structure of certain divisions, including Barca Visions, which will be incorporated into the newly formed Barca Media. German investment firm Libero, along with undisclosed private investors, will acquire a 29.5% stake in Barca Media from socios.com and Orpheus for $132 million. Specific details regarding the allocation of stakes between socios.com and Orpheus remain undisclosed. This transaction follows reports in the Spanish press about an unnamed German fund expressing interest in acquiring shares in Barca’s media arm. The injection of capital through this deal enables Barcelona to address a shortfall of €60 million ($66 million) in its budget. Failure to secure these funds would have resulted in the club’s inability to register players who signed new contracts with the league office. The current scenario leaves these players in limbo, as they are contractually bound to Barcelona but ineligible to compete in the Spanish league. Presently, Barcelona only has 12 registered players, as per The Athletic’s report. The injection of funds arrives just two days prior to the club’s season opener.