Juventus drama calls for an Exor exit strategy

Soccer Football - Joan Gamper Cup - FC Barcelona v Juventus - Estadi Johan Cruyff, Barcelona, Spain - August 8, 2021 Barcelona's Jordi Alba in action with Juventus' Juan Cuadrado REUTERS/Albert Gea

MILAN, Nov 29 (Reuters Breakingviews) - The board of Juventus FC (JUVE.MI) has walked off the pitch. Chairman Andrea Agnelli and the other directors resigned en masse on Monday amid intense legal and regulatory scrutiny of the Italian soccer club’s accounts. For top investor Exor (EXOR.AS), controlled by the Agnelli clan, it’s a chance to rethink long-held ties to the famed but chronically loss-making team.

Prosecutors in the club’s Turin home region, and Italian market regulator Consob, queried how Juventus accounted for its players’ pay. That prompted the club to change the way it booked bonuses awarded to players in the financial years ending in June 2020 and June 2021 and it will also restate its most recent financial results.

Juventus says the accounting changes will hardly impact its cash flow and net debt. Yet the dramatic exit of Andrea Agnelli, a close relative of Exor Chairman John Elkann and a backer of the failed breakaway Super League for top soccer clubs, makes an already questionable investment even worse.

With 36 Serie A league titles under its belt, Juventus is one of Italy’s most successful teams. Yet its victories on the pitch have not been matched in the financial statements. The club, which has had links to Agnellis since 1923, has been loss-making since at least 2018 and has needed repeated cash calls. Investment holding company Exor, which controls the club via a 64% stake, has splashed some 450 million euros in the past four years to prop it up, according to Equita analysts. And a further equity injection may still be necessary.

The reputational hit for the Agnellis belies Juventus’s small size. The listed team, worth roughly 700 million euros on the market, represents just 2% of Exor’s net asset value of 31 billion euros, as of the end of 2021. Despite the sentimental value the Agnellis attach to Juventus, severing ties may be the best option. Soccer clubs are in high demand, with Chelsea’s sale earlier this year attracting a feeding frenzy among would-be owners. Despite its problems, Juventus could, over time, fetch the same valuation multiple that private equity firm RedBird recently offered for compatriot AC Milan. At 4.6 times its forecast 494 million euros of revenue in the current financial year, based on Refinitiv data, Juventus could command a price tag of 2.3 billion euros including debt.

Potential suitors will probably sit on the sidelines while Juventus’s legal woes last. But in the meantime, working out an exit strategy makes sense.

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(The author is a Reuters Breakingviews columnist. The opinions expressed are her own.)


Juventus FC Chairman Andrea Agnelli resigned on Nov. 28 along with the Italian soccer club’s entire board, citing pending legal and accounting matters.

The loss-making club said that it would have to restate its financial statements for the fiscal year ending in June 2022.

Prosecutors and Italian market regulator Consob have been scrutinising the club for possible false accounting and market manipulation. They have been looking into the way Juventus accounted for players’ salaries. The company has denied any wrongdoing.

Financial holding company Exor, controlled by the Agnelli dynasty and chaired by family leader John Elkann, controls Juventus with a 63.8% stake.

Shares in Juventus were down 2.7% at 0.27 euros at 0915 GMT.

Editing by Liam Proud and Oliver Taslic

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