MADRID (Reuters) - China’s Orient Hontai has agreed to buy a majority stake in Spanish sports rights group Imagina for $1 billion, the latest deal from deep-pocketed Chinese investors to transform the Asian country into a global soccer powerhouse.
Imagina, usually just known as Mediapro after the name of one of its subsidiaries, has the rights to distribute the La Liga soccer championship, Europe’s third-richest league.
The Chinese private equity firm had reached a preliminary deal with three of Imagina’s shareholders to buy a 54 percent stake, Imagina founder and chairman Jaume Roures told Reuters in an interview.
Roures said the deal still had to be authorized by the Chinese government, which has cracked down on overseas football investments in recent months, though he hoped the operation could be closed in early 2018.
“The deal has been made. We hope to close it during the first quarter of 2018,” Roures said.
Chinese investors have been snapping up sports and entertainment assets abroad.
The acquisitions range from Swiss sports marketing firm Infront Sports & Media AG to Italian sports media rights company MP & Silva or soccer clubs Inter Milan and AC Milan.
Orient Hontai entered into exclusive talks with Imagina’s shareholders in May, scooping a dozen other bidders, including French media group Vivendi (VIV.PA), Chinese real estate and entertainment firm Dalian Wanda Group Co or U.S. media company Liberty Media (FWONA.O).
The selling shareholders are Spanish private equity firm Torreal, which holds 23 percent of the share capital, Mexican broadcaster Televisa TLVACPO.MX, which owns 19 percent, and one of the firm’s founders Gerard Romy, who has 12 percent.
Imagina, Torreal and Romy declined to comment. It was not immediately possible to contact Televisa and Orient Hontai for comment.
The deal was made at a multiple of 10 times 2016 core profit (EBITDA) and values the company at 1.6 billion euros ($1.9 billion), Roures said.
Under a shareholders’ pact with Orient Hontai, Roures and Tatxo Benet, who are the other two founders of Imagina with Romy and still each own a 12 percent stake, will remain at the helm of the company.
“The shareholders’ pact does not have any expiration date,” Roures said.
($1 = 0.8510 euros)
Editing by Julien Toyer and Adrian Croft