A long-rumored plan to create a Super League for soccer teams has arrived, with Europe's top 12 teams announcing plans to kick off in the 2023-2024 season, which could provide a big revenue win for several soccer teams.
What Happened: As of now, the Super League will include AC Milan, Arsenal, Atlético Madrid, Chelsea, Barcelona, Internazionale (Inter Milan), Juventus, Liverpool, Manchester City, Manchester United, Real Madrid and Tottenham.
The teams will resign from the European Club Association, a body of 232 teams across Europe. The formation of the Super League threatens the UEFA Champions League's tournament held annually, which features the top qualifying teams across European leagues.
No German or French teams have committed to the new Super League yet. The Super League would ultimately have a 20-team format with the founding 12 teams, an expected three more to join and five qualifying teams each year.
Related Link: 12 European Soccer Clubs, Backed By JPMorgan Chase, Break From UEFA To Form Rival League
UEFA is looking to announce a new format for the annual Champions League as it hopes can keep teams from leaving the tournament. The new structure would feature 36 teams and have teams play 10 group games instead of six. The largest teams would also have increased prize money.
Why It’s Important: Figures for JPMorgan Chase & Co JPM funding for the new league ranges from a $3.8 to $6 billion loan, according to various sources.
Founding clubs of the Super League could receive $400 million for their participation, according to the New York Times. The amount would be four times what the Champions League winner took home in 2020.
Due to the impact of the Champions League, UEFA could face demands from broadcasters for refunds as fewer fans could watch the competition due to not including the top teams in Europe. ViacomCBS Inc VIAC has the U.S. rights to Champions League along with Univision who has the Spanish language rights. The two broadcasters are set to pay $150 million annually for the Champions League 2021 to 2024.
Related Link: Exclusive: Roundhill MVP First Pure-Play Sports ETF Offers Growth, SPACs, Exposure To NFTs
UEFA, FIFA, club supporters and European political leaders have all spoken out about the move to form the Super League.
“As previously announced by FIFA and the six Federations, the clubs concerned will be banned from playing in any other competition at domestic, European or world level, and their players could be denied the opportunity to represent their national teams,” a statement by UEFA read.
Manchester United said the founding clubs will consider holding discussions with UEFA and FIFA to work together to “deliver the best outcomes for the new League and for football as a whole.”
Soccer Stocks: Manchester United MANU is one of the most well-known soccer teams in the world. The team trades publicly in the U.S. on the NYSE and is one of the ways investors could participate in the impact of the Super League.
Manchester United reported revenue of $709 million in the last fiscal year. The revenue was split $389 million for commercial, $195.4 million for broadcasting and $125.2 million for matchday. The revenue was down from the prior year due to not participating in the Champions League.
“The Super League will open a new chapter for European football, ensuring world-class competition and facilities and increased financial support for the wider football pyramid,” Manchester United Co-Owner Joel Glazier said.
Juventus FC SpA JVTSF trades OTC in the United States and in Italy.
The Roundhill MVP ETF MVP holds stakes in several of the largest soccer teams. The ETF counts Juventus as the third-largest holding representing 7.2%, Manchester United shares are the fourth largest holding in the ETF representing 6.8% of assets, and Borussia Dortmund, a top German team that has not committed to the Super League, is the fifth-largest holding at 5.8% of assets.
The ETF also holds stakes in Fenerbache, As Roma and AJAX AFC, which could all be impacted by the Super League competing against the Champions League.
Benzinga’s Take: The formation of the Super League still faces several hurdles and will likely need a compromise between the league and UEFA/FIFA to get the top players to participate. A Super League would provide significant revenue for the top European soccer teams.
If the Super League does not come to fruition, many of the top teams could still benefit with UEFA revamping the Champions League to favor the top teams.
Price Actions, Monday Morning: Shares of Juventus are up 21.98% to $1.11.
Shares of Manchester United are up 9.84% to $17.75.
Shares of Roundhill MVP ETF are up 1.65% at $14.75.
(Photo by Konstantin Evdokimov on Unsplash)
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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