Euro merger pumps up sports rights

Viv U, Bertelsmann, JC Darmon pact for new agency

PARIS — Vivendi Universal, Bertelsmann and Jean-Claude Darmon confirmed Tuesday that they will merge their sports rights activities in a pan-European agency with estimated annual sales of $492 million (Daily Variety, March 15).

The new company will combine Bertelsmann-owned RTL Group’s UFA Sports, Canal Plus’ Sport+ and the Group Jean-Claude Darmon, in which RTL already owns a 28% stake.

The new business, likely to be valued at about $1 billion, will be a major force in European soccer, managing TV and marketing contracts for more than 320 soccer clubs, more than 40 national soccer federations and major European soccer leagues. It will also be active in handball, rugby and tennis.

Leading French sports entrepreneur Jean-Claude Darmon, who will own a 5% stake, will head the new company as chairman-CEO. UFA Sports’ Bernd Hoffman and Jerome Valcke from Sport+ will be joint chief operating officers. RTL and Canal Plus will hold equal stakes of between 39.5% and 46.6% when the merger is completed by the end of this year.

Pierre Lescure, chairman of Canal Plus, described the merger as “a great opportunity. … Sport has always been at the heart of Canal Plus and its subscribers everywhere in Europe.”

RTL CEO Didier Bellens said the deal would enable the companies “to enjoy a strong position in the increasingly important sports rights sector.”

The merged company’s activities will be on a smaller scale than Germany’s Kirch, which owns the rights to World Cup soccer in 2002 and 2006 as well as high-profile Formula One motor racing.

Merger also will give RTL, which owns an array of free TV channels, and Canal Plus, Europe’s leading pay TV player, a stronger bargaining position at a time when sports rights costs are escalating.

Vivendi Universal recently opted not to acquire the ailing sports rights company ISSM-ISL, which was officially declared bankrupt Monday.