Money and personal dislikes threaten club league – 02/08/2023 – Sport

Two years before the end of the current broadcast contract, the desire to set up a league of clubs is far from being put on paper and could just be a new version of the Brazilian Championship that already exists today.

Due to lack of commercial agreements, club interests, personal dislikes and distrust, the teams that should form the A and B series of the national tournament are divided into two blocks. The biggest chance, at the moment, is that the negotiation is not unified.

“If there are two blocks, there really isn’t a league. There can’t be a league like that”, says Marcelo Paz, president of Fortaleza.

He is one of the spokespersons for the LFF (Liga Forte Futebol), which brings together 26 associations. This week, the group announced an agreement with the Brazilian manager Life Capital Partners and with the North American Serengetti Asset Management for investment in the new league. The proposal is R$ 4.85 billion to be distributed to the 40 teams from the two main divisions of the country.

If the LFF does not have the 40 associations, the value drops to R$ 2.3 billion.

Another 18 clubs formed Libra (Brazilian Football League). It is in this group that the shirts with the biggest fans in the country are: Flamengo, Corinthians, Palmeiras and São Paulo. Libra has an offer of BRL 4.8 billion from another fund, Mubadala, for the first and second division tournaments.

“It’s not the best possible design, but it’s still possible to do two blocks of negotiation. But the clubs will leave money on the table, they’ll lose with that”, opines Jorge Braga who, as CEO of Botafogo, participated in negotiations with the two blocks.

The new transmission contract for the Brazilian Championship, with or without a league, will have to come into force in 2025. Until then, the rights belong to Grupo Globo.

The main discussion is about the division of money. The percentage difference is not large. According to the agreement signed by the LFF, 45% of the contract would be divided equally, 30% for the championship classification and 25% for a heading called “commercial appeal”, which involves occupation in stadiums, social networks, game audience, among others.

In the case of Libra, the division would be: 40% equal, 30% for performance and 30% for “fan engagement”, which includes criteria similar to the “commercial appeal” of Forte Futebol.

LFF clubs complain that the division discussed by Libra is not included in the entity’s statute, the criteria cited to define what is fan engagement are not clear and, more importantly, there is no intention of placing a limit on difference between the team entitled to receive more and the one that would pocket less.

The LFF wants it stipulated that one club cannot earn more than 3.5 times the other.

For the leaders of Libra, this discussion will have to be done later. The fundamental thing is for everyone to sign the statute and carry out a unified negotiation.

There is the issue of lack of trust. Libra believes it has the primacy for having the teams with the biggest fans in the country, the ones that generate the most audience and engagement on social networks. Leaders of this group heard by the report believe that, in the end, the proposal they presented will prevail.

There was comment that if there were two Brazilians (one for each entity), Libra would be much more successful. When the entity’s statute was ready, members of the LFF were irritated by the attitude that there would be no possibility of negotiation. The terms were those and whoever wanted to, should sign. There was also disagreement with the item that any change in the document would have to be approved unanimously, not by majority vote.

Personal differences persist. Presidents of different teams don’t like each other and bring those preferences to the conference table. The representatives of Athletico (Mario Celso Petraglia, one of the main leaders of the LFF) and Flamengo (Rodolfo Landim, from Libra) are two examples.

In a meeting last year, Petraglia had a rough discussion with Flavio Zveiter, who was negotiating a contract later signed by Libra, but who was trying to make a consensus possible.

There is a suspicion, on the part of some Libra clubs, that the document signed by the LFF with Serengetti would not be “for real”, something denied by top hats from Forte Futebol heard by Folha.

Without consensus and divided into blocks, in addition to not earning as much as possible with broadcasting rights, the clubs leave undefined other factors that in Europe make national club leagues successful. Product formatting, naming rights, visual identity, selling games abroad, unified marketing initiatives are some examples.

It is also not clear what the criteria for using the resources by the teams will be and whether there will be financial fair play.

“One of the problems is that this discussion has been carried out by the agents, not by the clubs. These groups, which advise the clubs, have very different interests. If one group wins, the other is not remunerated”, defines Braga.

In the case of Libra, advice is provided by BTG Pactual and Codajas Sports Kapital. At LFF, there are XP investments, LiveMode and the Alvarez & Marsal office. The respective funds that want to put money into the league are also involved.

Company representatives believe that a consensus can be reached so that everyone wins. But they confess that, if the agreement is unfeasible, the only solution will be two negotiating blocs.

“If there is no agreement between the clubs, with each side selling part of the rights to a certain investor, the A and B series will continue to be managed by the CBF, as is the case today. The only difference will be in the commercial sphere, since each block will have a partner in sharing TV rights revenue”, believes lawyer Eduardo Carlezzo, specialized in sports law.

Neither party believes in this outcome because, at the moment, the CBF wants the league to get off the ground.

“Collective thinking is lacking. Instead of seeking the convergence of ideas, what we saw was an attempt to [a Libra] take clubs out of our group. They talk about uniting and try to do that”, complains Marcelo Paz.

In the next ten days, there should be a meeting between presidents of Libra clubs to discuss which way to go.

See the 18 clubs that are part of Libra:

Bahia, Botafogo, Corinthians, Cruzeiro, Flamengo, Grêmio, Guarani, Ituano, Mirassol, Novorizontino, Palmeiras, Ponte Preta, Red Bull Bragantino, Sampaio Corrêa, Santos, São Paulo, Vasco and Vitória.

See the 26 clubs that are part of the LFF:

ABC, Athletico, Atlético Mineiro, América-MG, Atlético Goianiense, Avai, Brusque, Chapecoense, Coritiba,
Ceará, Criciúma, CRB, CSA, Cuiabá, Figueirense, Fluminense, Fortaleza, Goiás, Internacional, Juventude,
Londrina; Náutico, Operário-PR, Sport, Vila Nova and Tombense.