3 Min Read
(Adds more details, quotes, adds byline)
By Matthias Sobolewski
BERLIN, Jan 31 (Reuters) - American buyout group KKR has agreed to take a 10 percent stake in Hertha Berlin in a deal worth about 60 million euros that will boost the capital club's finances and brand in the Bundesliga, the two sides said on Friday.
The private equity firm will pump in some 61 million euros ($82.74 million) in total for a 9.7 percent stake, helping Hertha reduce its debt and buy back marketing and catering rights that the club sold to plug holes in its balance sheet, officials said.
"This is a groundbreaking deal for Hertha," Hertha president Werner Gegenbauer said. "For years the board had a target to find a strategic partner. Today this wish becomes reality."
The deal allows Hertha, who are seventh in the Bundesliga after winning promotion last season, breathing space and sets the foundations for a long-term Bundesliga presence.
In the club's former rollercoaster years moving between divisions Berlin was the only European capital without a top-flight football club.
The investment marks a rare occasion where a major foreign investor has taken a share in a German club with strict ownership rules forbidding a single investor from controlling more than half of a club's shares.
German companies Adidas and Audi own similar nine percent stakes in Bayern Munich and Russia's Gazprom has a long-standing sponsorship partnership with Schalke 04.
"This partnership with KKR as a major investor is a quantum leap for the club and its financial side," said Hertha CEO Michael Preetz, whose club has twice been relegated in the past four seasons.
"In the future Hertha will have more space to act and we will stick by our current strategy to bring in talented young players and also rely on our youth work."
The KKR investment is aimed at maximising Hertha's potential and the company will not try to influence sport-related issues such as engaging players, the two sides said.
"We are delighted to be able to support Hertha as a partner and we see clear potential to strengthen the club nationally and internationally," said Johannes Huth, European head of KKR.
"The great and loyal fan community, the unique development programme and the fact that it is the German capital's leading soccer club make Hertha an attractive partner."
The German Bundesliga has been booming in the past few years with the league posting a ninth straight annual turnover record days ago with 2.17 billion euros for 2012-13. ($1 = 0.7373 euros) (Reporting by Anro Schuetze and Karolos Grohmann, Writing by Karolos Grohmann. editing by Ed Osmond)