The story that has been brewing for the best part of three months has finally reached a conclusion: Bridgepoint, the private equity firm that owns Dorna, MotoGP's organizers, has acquired Infront Sports & Media, the sports marketing firm that owns Infront Motor Sports, the organizers of World Superbike series. Infront yesterday issued an official press release announcing the acquisition, with Bridgepoint purchasing the company from its three major shareholders.
The press release states emphatically that the takeover will have no effect on the running of either the MotoGP or the World Superbike series, though clearly, such a move would put an end to any legal moves which Infront Motor Sports may have been considering against the FIM over the use of production engines in CRT machines. The two series are not to merge, the press release stated, saying that both MotoGP and World Superbikes will continue to run separately under the auspices of the FIM.
Though the purchase has been completed, it is still subject to scrutiny by the European Competition Commission. There is some history here: when CVC - Dorna's previous owners - acquired the rights to Formula 1, the Competition Commission forced CVC to sell its stake in Dorna. Bridgepoint acquired that share in Dorna for a reported 550 million euros, felt by many to be an overvaluation, even at the time. The rationale for forcing CVC to divest its stake in Dorna was because it was felt that having the two premier motorsports series in the hands of a single company created an unhealthy situation with regards to TV rights, and the issue was raised after lobbying by Spanish and Italian TV broadcasters. With the two premier motorcycle racing series in the hands of one party, a similar situation could arise, and Bridgepoint could be forced to divest itself of either Dorna or Infront Motor Sports. Such a process takes some time, however, and no news is expected on that from for the foreseeable future.
Below is the press release from Infront Sports and Media announcing the acquisition by Bridgepoint:
Bridgepoint reaches agreement to acquire Infront Sports & Media AG
Paris, France / Zug, Switzerland, 2 September 2011 – European private equity firm Bridgepoint has reached an agreement to acquire Infront Sports & Media AG, one of the world's most respected and leading international sports marketing companies based in Zug, Switzerland, taking 100 per cent of Infront's shares from Jacobs Holding AG, the Junkermann Group and Dr Martin Steinmeyer for an undisclosed sum. The acquisition is subject to the approval of the antitrust authorities.
After an intense period of growth and another year of high performance, Infront today occupies a strong position in the global sports marketing industry representing more than 120 top sports rights holders and delivering 2,300 event days each year. In 2010, Infront generated revenues of over EUR 600 million and has more than 20 offices across Europe and Asia and a diversified rights portfolio in winter sports, football and summer sports. It is also a key player in media production handling some of the most complex sports events, including the FIFA World Cup™.
In football, it is partner to international and national federations (e.g. the German Football Federation DFB), leagues (e.g. the Italian Lega Calcio) as well as clubs (e.g. A.C. Milan, FC Schalke O4, SV Werder Bremen). In winter sports, Infront is the undisputed market leader representing six out of the seven Olympic winter sports federations, including FIS for skiing and the IIHF for ice hockey; in motor sports, it is the promoter of the FIM Superbike World Championship. Infront is also one of the leading sports marketing organisations in China where it represents the Chinese Basketball Association – on league and national team level.
Dr Andreas Jacobs, Chairman of the Infront Board of Directors, said: "We are pleased that after an extensive strategic review we have found a new investor which will actively contribute to Infront's ambitious growth plans which we believe will be of great benefit to our esteemed clients as well. We wish Bridgepoint and Infront well on behalf of the current shareholders."
Miss Nicole Junkermann, Vice Chairman of the Infront Board of Directors, said: "We feel a phase of the successful story of Infront initiated by Robert Louis-Dreyfus has ended today. Infront remains a great testament of the enterpreneurial spirits embodied in the organization. We are confident the new shareholder will allow Infront to reach even greater goals in global sport marketing."
Xavier Robert, Partner at Bridgepoint in Paris, said: "Infront is a scarce asset in an attractive sector with a strong management team and a unique competitive position. It has a well diversified portfolio of prestigious and operationally complex events that position it well to outperform the market. Not only are there continued growth prospects with current rights holders, but also the potential for strategic expansion in terms of geography, products and services. Based on the existing strategy and our combined experience, we expect Infront to continue to grow as it captures new opportunities in the international sports entertainment market, ultimately establishing Infront as the global number one sports marketing group."
Philippe Blatter, Infront's President & CEO, said: "Bridgepoint is the strong new strategic investor we have been looking for. The company is fully committed to actively contribute to Infront's ambitious expansion plans and to support our solid international team – Bridgepoint shares our long-term vision. We are convinced that the new and strengthened ownership structure will not only form an even stronger basis for the future success of Infront, but will be of great benefit to our valued partners and clients. With Bridgepoint as our shareholder, we are in a position to tackle many additional opportunities now presented by the market while remaining highly focused on the continued delivery of high quality services to our clients and partners in all areas of our existing business."
The global sports rights market is estimated to be worth USD 121 billion in 2011, with the global market for media and sponsorship rights representing USD 56 billion. Bridgepoint's experience in the sector includes its current investment via another fund in Dorna, the global rights holder to the MotoGP Motorcycle World Championship, as well as a successful track record in TV production that includes All3Media in Great Britain, producer of Formula One in the UK and Marathon Group in France, respectively sold in 2006 and 2007.
Bridgepoint will encourage the further development of Superbike and MotoGP although both series will continue to be organised and managed separately. Dorna and Infront Motor Sports are each fully committed to the long-term relationship with the Fédération Internationale de Motocyclisme (FIM) as their strategic partner as well as the successful partnerships with teams and manufacturers, circuit owners, sponsors, broadcasters and other stakeholders of the series.
Bridgepoint was advised on the transaction by Leonardo (corporate finance), Deloitte, Value Partners (market due diligence), KPMG (financial and tax due diligence), Latham & Watkins, Niederer Kraft & Frey (legal); Jacobs Holding AG and Junkermann Group were advised by Goldman Sachs, Nomura (corporate finance), Deloitte (financial and tax due diligence), Shearman & Sterling, Homburger, Lenz & Stähelin (legal); Dr Martin Steinmeyer was advised by Wirsing Hass Meinhold Rechtsanwälte (legal).
Bridgepoint is a European private equity firm focusing on the acquisition of companies valued up to €1 billion. With some €11 billion of capital raised to date, it typically focuses on acquiring well managed companies in attractive sectors with the potential to grow organically or through acquisition. Although a generalist investor,Bridgepoint has developed expertise in the business services, consumer, financial services, healthcare, media, and industrial sectors. It has offices throughout Europe in Frankfurt, Helsinki, Istanbul, London, Luxembourg,Madrid, Milan, Paris and Stockholm. See www.bridgepoint.eu.
Bridgepoint is currently investing a €4.8 billion fund, Bridgepoint Europe IV, which had its final closing in November 2008 and has made 12 investments to date. In addition to this investment, its investments in 2011 have included the acquisition of Foncia, the French residential property management services business, La Gardenia, an Italian perfumery chain, SPTS, a UK capital equipment provider serving high-growth manufacturing applications within the semiconductor industry, German specialty chemicals company CABB and the la Boga wind energy division (comprising a portfolio of 11 wind farms) of ACS in Spain.
About Infront Sports & Media
Infront Sports & Media, based in Zug, Switzerland, has grown impressively in recent years to become one of the world's most respected and leading international sports marketing companies. The company employs more than 500 experienced and passionate staff across more than 20 offices in 10 countries and offers high quality services in four business areas: distribution of media and marketing rights, media production and sports services (hospitality, advertising solutions, etc.). Infront has long-lasting partnerships with 120 clients and hundreds of sponsors and media companies. Annually, the Group helps to deliver more than 2,300 event days of top class sport around the world, equalling more than six events per day.
Today, Infront is the strongest, most experienced marketing agency in the winter sports arena, representing six out of seven Olympic winter sport federations. It has a unique heritage in football - no other agency has the same depth of involvement supporting the game at every level, international, country, league and club – and is strong in other major summer sports including basketball, handball, volleyball and motor sports.
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