Investing in La Liga MX
5 minute read · Issue Number 122 · May 27th, 2022
During all my time living in Mexico, I’ve never felt the level of excitement from the locals for a futbol season as hyped as it feels now.
Atlas and Pachuca face off this week in a two-game final matchup to dictate a champion for the first tournament of the year.
Believe me when I say – every taqueria, pub, restaurant, and bar in the city has been televising the playoff games on repeat, even when no live matches are going on!
Newspapers, magazines, radio, and sports shows are talking non-stop about the playoffs. Everyone’s wearing merch on the streets and talking about it – even my grandma has asked me about it!
Turns out – I may not be the only one noticing the quick popularity growth of the Mexican soccer league.
According to Sportico, private equity firm Apollo Global Management plans to offer La Liga MX $1.25 billion for a 20% share of the Mexican soccer league’s international media revenue over the next 50 years.
My first reaction to the news was – “50 years!? That’s insane!”
But then, I decided to dig deeper to understand why it makes sense. Grab some morning coffee while we break it down.
In Mexico, Liga MX absolutely dominates. Nonetheless, the league’s also playing the international game well, particularly in the United States.
La Liga MX has been widely successful in the US over the last few years leading as the most-watched soccer league, outperforming both the European leagues and the MLS.
Currently – the Liga MX clubs’ broadcasting rights in the US are worth about $110m per year and are spread across Fox Deportes, Univision, Telemundo, ESPN Deportes, and TUDN.
Although the problem is that the international broadcasting rights in Liga MX are distributed at a club level, instead of at a league level.
Nevertheless, their numbers are quite remarkable. Univision itself reaches around 37.7 million households in the US and held an average viewership of 845,000 in the 2021 season. In contrast, for Premier League matches, NBC averaged a viewership of 475,000 in 2021.
Liga MX has almost twice as much viewership as the Premier League in the US.
Read that again.
If you’re still not convinced, you might be when you realize these margins have been consistent since 2016:
Private equity firms invest huge amounts of money and have access to diverse investment opportunities in sports, such as funding events, acquiring a stake in clubs and leagues, or even getting a share in media rights deals.
Usually, private equity firms hold investment horizons between four and seven years, although Apollo is looking to lock their capital on a 50-year deal for this particular case.
Private equity firms have a competitive advantage in the investment world due to the large amounts of capital under management. They can access ambitious projects that could deliver outsized returns.
The opportunity to invest and seek returns from a project as big as La Liga MX is not available to the regular investor and considering the current economic environment, its growth potential, and its promising positioning in the market – it may be a massive opportunity for Apollo.
Check out this Twitter thread I wrote with some numbers behind the investment
The Bottom Line
With a great product, a solid market share in the US, and a growing global interest in soccer, Liga MX might be in a primed position to capitalize on its offering.
Private equity firms are starting to realize this and are rushing to buy a piece of the cake before it’s too late.
From a financial standpoint – the investment makes total sense. It looks like a massive opportunity for Apollo to take a stake in La Liga MX and bet on its growth and its long-term potential.
The ball is now on the Liga MX’s court – and it will depend on its management’s capability to handle rights at a league level, establish a fair value to its offering, and turn this opportunity to capitalize, grow, and finally raise the Mexican league to a world-class standard.
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Fan Relationships and Engagement at the Premier League
Cathy Long worked for over 15 years in the Premier League on fan campaigns, media, partnerships, policy, and diversity. She also became an independent consultant for clients like Tottenham, Liverpool, Watford, and Swansea FC.
Cathy founded Aposto – a digital platform that provides services and tech products for sports venues and organizations.
In this episode, you'll learn what it's like to work at a sports league from Cathy's experiences in the PL and with the clubs. You'll also hear best practices on working (and understanding) with fans, fan empowerment, diversity, and inclusion. Finally, we discussed how Aposto enables new solutions for sports venues and organizations.
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